Urban Outfitters, Inc. announced net sales over November and December rose 14.6 percent, although it indicated that higher freight costs and promotions at the Free People brand will impact margins.

The company said that due to the material impact of COVID-19 on its business operations in fiscal 2021, including mandated store closures, this release includes a comparison of fiscal 2022 results to fiscal 2020. Management views the comparison of fiscal 2022 results to fiscal 2020 as the more meaningful measurement of the company’s business performance.

Total company net sales for the two months ended December 31, 2021, increased 14.6 percent compared to the two months ended December 31, 2019. Comparable Retail segment net sales increased 14 percent, driven by strong double-digit growth in digital channel sales, partially offset by high single-digit negative retail store sales primarily due to reduced store traffic. By brand, comparable Retail segment net sales increased 47 percent at the Free People Group, 15 percent at the Anthropologie Group and 3 percent at Urban Outfitters. Total Retail segment net sales increased 15 percent. Wholesale segment net sales decreased 18 percent primarily from reducing the Free People Group’s sales to promotional wholesale customers. URBN now believes that the total company fourth-quarter gross margin could deleverage due to higher than anticipated inbound transportation costs.

For the eleven months ended December 31, 2021, total company net sales increased 14.4 percent compared to the eleven months ended December 31, 2019. Comparable Retail segment net sales increased 16 percent, driven by strong double-digit growth in digital channel sales, partially offset by low double-digit negative retail store sales due to reduced store traffic. Wholesale segment net sales decreased 22 percent primarily from reducing the Free People Group’s sales to promotional wholesale customers.

Urban Outfitters brands include Anthropologie, BHLDN, Free People, FP Movement, Terrain, Urban Outfitters, Nuuly and Menus & Venues.

Photo courtesy Urban Outfitters/Free People