It was exactly one year ago that Urban Outfitters' (NASDAQ:URBN) president and chairman, Richard Hayne, warned shareholders that 2006 was going to be rough because the fashion world was undergoing a "tectonic shift." History is nice, but investors are waiting to hear what the future holds.

Urban Outfitters' fourth-quarter net income edged up, although earnings per share were flat. Sales increased 13% to $360.8 million, while same-store sales decreased 5% versus an 8% increase in comps this time last year. Margins decreased as the company navigated a difficult 2006. (Our Fool by Numbers feature delivers Urban Outfitters' fourth-quarter earnings numbers in their entirety.)

In a refreshing departure from many retailers' tidings, Anthropologie and Free People both experienced positive comps in February. The news media reported that many retailers' comps lagged during the frigid and stormy month, and blaring headlines asked whether it was "weather or styles" that caused the problem. Some of the retailers highlighted for a weaker-than-expected February were Wal-Mart (NYSE:WMT), American Eagle Outfitters (NYSE:AEO), and J.C. Penney (NYSE:JCP). One month is certainly too short a time on which to base any kind of judgment call, but the two brands' success in what has been described as a difficult month may support the idea that things are improving.

Although Urban Outfitters' press release said it's "guardedly optimistic" about its "modest" sales goals, in the conference call, Hayne expressed his belief that the retailer has emerged from the "period of confusion" caused by the now-infamous tectonic shift in fashion. He said the retailer is finding appropriate ways to interpret the new fashion looks for its brands.

Let's not forget the mysterious Concept 4. Urban Outfitters is expected to announce exactly what the new retail concept will be by the end of the third quarter this year, although the company described the demographic it will target as one it knows well: "the well educated, well read, and well traveled woman." Well. I, for one, can't wait to hear more.

Of course, we'll all have to wait and see what really transpires, but it's good to hear some optimism from Urban Outfitters (and to its credit, the company seemed very frank during last year's fashion shake-up). All in all, it looks like it could be an interesting year for Urban Outfitters.

Flash back to Urban Outfitters over the last year:

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Alyce Lomax owns shares of Urban Outfitters. The Fool's disclosure policy is always in fashion.