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Urban Outfitters falls on diseased sales growth, grill deal

Apparel tradesman Urban Outfitters Inc (URBN.O) reported weaker-than-expected allied sales, pier some-more vigour on a shares already stretched by a warn squeeze of an Italian pizza sequence progressing on Monday.

Shares of a association fell as most as 10 percent after Urban Outfitters pronounced it would buy a Vetri Family grill group, and fell another 10 percent in extended trade after a association reported diseased third-quarter results.

Urban Outfitters’ opening in a entertain finished Oct.31 was “sub-par”, Chief Executive Richard Hayne pronounced on a post-earnings call, citing diseased sales during a company’s namesake brand.

Retailers have been harm by a prolonged spell of comfortable continue in Sep and October, that is weighing on cold-weather attire such as coats and jackets.

The company’s enlargement into a grill business comes during time when consumers are spending reduction on discretionary equipment such as garments and cosmetics.

Urban Outfitters is not new to a food business. Some of a company’s stores already have restaurants and coffee bars trustworthy to them.

“While a intensity overlie of a patron bottom is obvious, a plea of handling a new business and successfully integrating it with URBN is not insignificant,” Stifel researcher Richard Jaffe wrote in note.

Neil Saunders, arch executive of sell investigate organisation Conlumino, combined that a deal, that includes a grill sequence Pizzeria Vetri, could corrupt government courtesy and capital.

Philadelphia-based Urban Outfitters pronounced third-quarter allied sales during a namesake brand, a second-biggest by sales, rose by 1 percent in a entertain finished Oct. 31.

Analysts polled by investigate organisation Consensus Metrix had approaching sales during a code to grow 3 percent.

The company’s quarterly net income rose 10.3 percent to $52 million, or 42 cents per share, relating a normal researcher estimate.

Net sales rose 1.3 percent to $825.3 million, though fell brief of a $869.8 million analysts had expected.

Up to Monday’s close, Urban Outfitters shares had depressed about 35 percent this year.

(Reporting by Subrat Patnaik in Bengaluru; Editing by Don Sebastian)

Article source: http://www.reuters.com/article/2015/11/17/us-urban-outfitters-results-idUSKCN0T52JF20151117

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