8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported)  November 13, 2003

URBAN OUTFITTERS, INC.

(Exact Name of Registrant as Specified in its Charter)

Pennsylvania	000-22754	22-2003332
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

1809 Walnut Street, Philadelphia PA	19103
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code  (215) 564-2313

N/A

(Former name or former address, if changed since last report)

Item 7.    Financial Statements, Pro Forma Financial Information and Exhibits

(c) Exhibits:

99.1    Earnings Release dated November 13, 2003 – Third Quarter FY’04 Earnings

Item 12.    Results of Operations and Financial Condition

On November 13, 2003, the Company issued an earnings release, which is attached hereto as Exhibit 99.1 and incorporated herein by reference. The earnings release disclosed material non-public information regarding the Company’s financial position and results of operations as of and for the three and nine-months ended October 31, 2003.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	URBAN OUTFITTERS, INC.
Date:  November 18, 2003	By:	/s/  Richard A. Hayne
		Richard A. Hayne Chairman and President

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Exhibit Index

99.1    Earnings Release dated November 13, 2003 – Third Quarter FY’04 Earnings

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EX-99.1

Exhibit 99.1

URBAN OUTFITTERS, INC.

Philadelphia, PA – November 13, 2003

For Immediate Release	Contact:	Richard A. Hayne
		Chief Executive Officer
		(215) 564-2313

Urban Outfitters Reports a 76% Increase in Q3 Earnings

Urban Outfitters, Inc. (NASDAQ:URBN), a leading lifestyle consumer products company doing business under the Anthropologie, Free People and Urban Outfitters brands, today announced record earnings of $14.1 million for the third quarter ended October 31, 2003, a 76% increase over the comparable quarter last year. Third quarter earnings per diluted share rose to $0.35 this year versus $0.20 in the prior year.

As reported earlier, net sales for the quarter increased by 29% to a record $142.3 million. This increase over the prior year was fueled by:

• A 23% increase in the number of stores in operation

• A 17% increase in total Company comparable store sales

• A 48% increase in direct-to-consumer sales

During the quarter, comparable store sales rose 15% at Urban Outfitters Retail and 19% at Anthropologie Retail, as compared to increases of 8% and 15%, respectively, for the same period in the prior year. New and noncomparable store sales increases for the quarter totaled $13.2 million.

“Our Retail brands and Direct businesses produced truly outstanding results in the third quarter,” said Richard A. Hayne, Chairman and President. “Sales were strong in all regions where we operate stores; and Direct sales, particularly over the internet, continued their meteoric growth. Most gratifying, however, was delivering 16.5% operating margins. This is the highest quarterly rate in the last seven years.”

Net sales for the periods were as follows:

	Three months ended October 31,				Nine months ended October 31,
	2003		2002		2003		2002
	(in thousands)				(in thousands)
Urban Outfitters store sales	$	71,290	$	57,660	$	184,149	$	154,590
Anthropologie store sales		52,865		37,547		141,693		112,577
Direct-to-consumer sales		12,690		8,583		31,421		22,374
Free People sales		5,486		6,316		14,975		15,640
Total net sales	$	142,331	$	110,106	$	372,238	$	305,181

For the quarter and the nine months, the Company’s gross profit margins increased by 434 and 263 basis points, respectively, versus the comparable prior year periods. These gains were due primarily to higher initial merchandise margins, decreased markdowns and the leveraging of occupancy expenses.

As of October 31, 2003, total Company inventories grew by $15.7 million on a year-over-year basis. This increase was almost entirely due to the acquisition of inventory to stock new retail stores. On a comparable store basis, inventories decreased by a modest 0.9% versus the prior year. Management believes that existing inventory, along with shipments of merchandise scheduled to arrive in November and early December, will be adequate to satisfy Holiday demand even though comparable store sales in early November continue to significantly exceed plan.

For the quarter and the nine months, selling, general and administrative expenses, expressed as percentages of net sales, decreased by approximately 27 and 29 basis points, respectively, versus the same periods in the prior year. The leveraging of store-related expenses more than offset additional costs associated with the distribution of approximately 1.7 million and 2.6 million copies of the newly launched Urban Direct catalog during the three and nine months, respectively.

Thus far this fiscal year, the Company has opened thirteen new stores – eight Anthropologie stores and five Urban Outfitters stores. Management plans to open seven or eight additional new stores during the remainder of Fiscal 2004.

Urban Outfitters, Inc. is an innovative specialty retailer and wholesaler that offers a variety of lifestyle merchandise to highly defined customer niches through 58 Urban Outfitters stores in the United States, Canada, and Europe; an Urban Outfitters web site and catalog; 47 Anthropologie stores in the United States; an Anthropologie catalog and web site; and Free People, the Company’s wholesale division, which sells its product to approximately 1,100 specialty stores, department stores and catalogs, as well as through one Free People store.

A conference call will be held today to discuss third quarter results and will be web cast at 11:00 a.m. EST at:

http://www.corporate-ir.net/ireye/ir_site.zhtml?ticker=URBN&script=1010&item_id=803008

Notes of the Company’s conference call presentation will be available on:

www.urbanoutfittersinc.com.

This news release is being made pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995.    Certain matters contained in this filing may constitute forward-looking statements. Any one, or all, of the following factors could cause actual financial results to differ materially from those financial results mentioned in the forward-looking statements: the difficulty in predicting and responding to shifts in fashion trends, changes in the level of competitive pricing and promotional activity and other industry factors, overall economic and market conditions and the resultant impact on consumer spending patterns, including any effects of terrorist acts or war, availability of suitable retail space for expansion, timing of store openings, seasonal fluctuations in gross sales, the departure of one or more key senior managers, import risks, including potential disruptions and changes in duties, tariffs and quotas and other risks identified in filings with the Securities and Exchange Commission. The Company disclaims any intent or obligation to update forward-looking statements even if experience or future changes make it clear that actual results may differ materially from any projected results expressed or implied therein.

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URBAN OUTFITTERS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(amounts in thousands, except share and per share data)

	October 31, 2003		January 31, 2003		October 31, 2002
	(unaudited)				(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	37,396	$	72,127	$	51,555
Marketable securities		21,544		7,379		3,755
Accounts receivable, net of allowance for doubtful accounts of $705, $563 and $658, respectively		6,478		3,262		6,265
Inventories		72,213		48,825		56,518
Other current assets		14,771		12,991		8,940
Total current assets		152,402		144,584		127,033
Property and equipment, net		123,023		108,847		111,841
Marketable securities		48,714		15,640		24,230
Deferred income taxes and other assets		8,863		8,925		9,077
	$	333,002	$	277,996	$	272,181
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	31,260	$	19,186	$	26,214
Other current liabilities		28,004		23,886		23,488
Total current liabilities		59,264		43,072		49,702
Deferred rent and other liabilities		11,190		10,539		9,418
Total liabilities		70,454		53,611		59,120
Shareholders’ equity:
Preferred shares; $.0001 par value, 10,000,000 shares authorized, none issued		—		—		—
Common shares; $.0001 par value, 100,000,000 shares authorized; 39,500,072, 38,763,272 and 38,525,472 shares issued and outstanding, respectively		4		4		4
Additional paid-in capital		75,001		67,160		64,842
Retained earnings		186,476		156,529		148,152
Accumulated other comprehensive income		1,067		692		63
Total shareholders’ equity		262,548		224,385		213,061
	$	333,002	$	277,996	$	272,181

URBAN OUTFITTERS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(amounts in thousands, except share and per share data)

(Unaudited)

	Three months ended October 31,						Nine months ended October 31,
	2003			2002			2003			2002
Net sales	$	142,331		$	110,106		$	372,238		$	305,181
Cost of sales, including certain buying, distribution and occupancy costs		85,520			70,932			231,846			198,080
Gross profit		56,811			39,174			140,392			107,101
Selling, general and administrative expenses		33,333			26,082			90,753			75,293
Income from operations		23,478			13,092			49,639			31,808
Other income, net		198			397			692			185
Income before income taxes		23,676			13,489			50,331			31,993
Income tax expense		9,589			5,463			20,384			12,957
Net income	$	14,087		$	8,026		$	29,947		$	19,036
Net income per common share:
Basic	$	0.36		$	0.21		$	0.77		$	0.51
Diluted	$	0.35		$	0.20		$	0.75		$	0.50
Weighted average common shares and common share equivalents outstanding:
Basic		39,444,429			38,474,648			39,124,390			37,326,884
Diluted		40,753,913			39,360,882			40,128,649			38,446,094
AS A PERCENT OF NET SALES
Net sales		100.0	%		100.0	%		100.0	%		100.0	%
Cost of sales, including certain buying, distribution and occupancy costs		60.1	%		64.4	%		62.3	%		64.9	%
Gross profit		39.9	%		35.6	%		37.7	%		35.1	%
Selling, general and administrative expenses		23.4	%		23.7	%		24.4	%		24.7	%
Income from operations		16.5	%		11.9	%		13.3	%		10.4	%
Other income, net		0.1	%		0.4	%		0.2	%		0.1	%
Income before income taxes		16.6	%		12.3	%		13.5	%		10.5	%
Income tax expense		6.7	%		5.0	%		5.5	%		4.3	%
Net income		9.9	%		7.3	%		8.0	%		6.2	%

URBAN OUTFITTERS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(amounts in thousands)

(Unaudited)

	Nine months ended October 31,
	2003			2002
Cash flows from operating activities:
Net income	$	29,947		$	19,036
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		16,055			13,264
Tax benefit of stock option exercises		1,945			1,607
Changes in assets and liabilities:
Increase in accounts receivable		(3,213	)		(2,121	)
Increase in inventories		(23,355	)		(15,275	)
Increase in other assets		(1,709	)		(1,909	)
Increase in accounts payable, deferred rent and other liabilities		11,926			8,046
Net cash provided by operating activities		31,596			22,648
Cash flows from investing activities:
Capital expenditures		(24,245	)		(16,918	)
Purchases of marketable securities		(74,056	)		(45,209	)
Sales and maturities of marketable securities		25,945			17,100
Net cash used in investing activities		(72,356	)		(45,027	)
Cash flows from financing activities:
Exercise of stock options		5,896			3,819
Issuance of common shares, net of issuance costs		—			41,546
Net cash provided by financing activities		5,896			45,365
Effect of exchange rate changes on cash and cash equivalents		133			318
(Decrease) increase in cash and cash equivalents		(34,731	)		23,304
Cash and cash equivalents at beginning of period		72,127			28,251
Cash and cash equivalents at end of period	$	37,396		$	51,555