On March 8, so-hip-it-hurts clothing retailer Urban Outfitters
- Net earnings were flat, but both free cash flow and owner earnings increased somewhat. When FCF is larger than earnings, it can often indicate Foolishly conservative accounting practices. Keep in mind, though, that this line has been negative three quarters in a row, as Urban Outfitters expands its store network post haste.
- Inventory growth has been kept in check, leading to a tighter cash conversion cycle -- always good news for a retailer.
- Urban Outfitters still ranks in the upper echelon of clothing retailers on that important metric. Abercrombie & Fitch
(NYSE:ANF) and Aeropostale(NYSE:ARO) are tough to match, but Urban leads Talbots(NYSE:TLB) .
(Figures in millions, except per-share data)
Income Statement Highlights
Q4 2007 |
Q4 2006 |
Change |
|
---|---|---|---|
Sales |
$360.8 |
$318.6 |
13.2% |
Net Profit |
$35.7 |
$35.6 |
0.4% |
EPS |
$0.21 |
$0.21 |
0.0% |
Diluted Shares |
168.6 |
170.5 |
(1.1%) |
Get back to basics with a look at the income statement.
Margin Checkup
Q4 2007 |
Q4 2006 |
Change* |
|
---|---|---|---|
Gross Margin |
36.7% |
39.5% |
(2.8) |
Operating Margin |
13.4% |
16.6% |
(3.2) |
Net Margin |
9.9% |
11.2% |
(1.3) |
Margins are the earnings engine. See how they work.
Balance Sheet Highlights
Assets |
Q4 2007 |
Q4 2006 |
Change |
---|---|---|---|
Cash + ST Invest. |
$159.3 |
$191.8 |
(17.0%) |
Accounts Rec. |
$20.9 |
$14.3 |
45.7% |
Inventory |
$154.4 |
$140.4 |
10.0% |
Liabilities |
Q4 2007 |
Q4 2006 |
Change |
---|---|---|---|
Accounts Payable |
$57.9 |
$41.3 |
40.3% |
Long-Term Debt |
$0.0 |
$0.0 |
N/A |
Learn the ways of the balance sheet.
Cash Flow Highlights
Q4 2007 |
Q4 2006 |
Change |
|
---|---|---|---|
Cash From Ops. |
$86.5 |
$81.5 |
6.2% |
Capital Expenditures |
$53.2 |
$49.6 |
7.1% |
Free Cash Flow |
$33.3 |
$31.9 |
4.7% |
($0.9) |
($3.2) |
70.5% |
Find out why Fools always follow the money.
Cash Conversion Checkup
Q4 2007 |
Q4 2006 |
Change |
|
---|---|---|---|
Days in Inventory |
65.8 |
72.5 |
(6.7) |
Days in Receivables |
5.0 |
4.6 |
0.4 |
Days Payables Outstanding |
23.6 |
22.1 |
1.5 |
Cash Conversion Cycle |
47.2 |
55.1 |
(7.9) |
Read up on cash conversion metrics.
Related Foolishness:
- Fool on the Street: Urban Outfitters
- Two Teen Retailing Ideas
- Urban Outfitters Foolish message board
- Foolish Fundamentals: Cash Conversion Cycle
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At the time of publication, Anders Bylund had no position in any company mentioned. Fool rules are here.