Philadelphia—Urban Outfitters Inc. reported Monday a lower second quarter profit as the lifestyle retailer was hit by weak margins that offset sales increases.
The company, which operates Urban Outfitters, Anthropologie, Free People, Terrain and BHLDN, posted earnings per share of 49 cents, down from 51 cents a year ago. The analyst consensus expected 49 cents.
Net sales were up 7% go $811 million from $758 million a year ago and ahead of analysts’ estimate for $807 million in sales. Wholesales sales were up 36%.
Comparable store sales were flat for the quarter. By division, Free People posted a 21% increase and Anthropologie a 6% increase, while Urban Outfitters fell 10%.
Results also were hurt by gross margin that fell to 37.4% from 39.3% last year, due to the under performance at Urban Outfitters and store occupancy deleverage.
Selling and general expenses increased by $19 million, due to marketing and technology expenses.
Urban Outfitters didn’t offer any forecasts, but analysts’ consensus estimates for the third quarter $1.96 a share on revenues of $3.35 billion.