PHILADELPHIA, PA, March 11, 2013 - Urban Outfitters, Inc. (NASDAQ:URBN), a leading lifestyle specialty retail company operating under the Anthropologie, BHLDN, Free People, Terrain and Urban Outfitters brands, today announced net income of $83 million and $237 million for the fourth quarter and year ended January 31, 2013, respectively.  Earnings per diluted share were $0.56 for the quarter and $1.62 for the year.

Total Company net sales for the fourth quarter of fiscal 2013 increased to a record $857 million or 17% over the same quarter last year. Comparable retail segment net sales, which include our comparable direct-to-consumer channel, increased 11% while comparable store net sales were flat. Direct-to-consumer returns at stores are charged against store sales.  Excluding these returns, comparable store net sales would have been low single-digit positive.  Comparable retail segment net sales increased 37% at Free People, 11% at Urban Outfitters and 7% at Anthropologie. Direct-to-consumer net sales surged by 44% for the quarter and wholesale segment net sales rose 22%.

For the year ended January 31, 2013, total Company net sales increased to a record $2.8 billion or 13% over the prior year. Comparable retail segment net sales increased 7% while comparable store net sales decreased by 1%. Excluding the direct-to-consumer returns at stores, comparable store net sales would have been low single-digit positive.  Direct-to-consumer net sales increased by 31% for the year and wholesale segment net sales increased 12%.

"I congratulate each of our brand and shared service teams for delivering an excellent fourth quarter," said Chief Executive Officer, Richard A. Hayne. "We entered the year with a plan to invest in initiatives to drive top line growth and improve margins. We succeeded on both fronts especially in the fourth quarter. We will pursue a similar strategy in the current fiscal year as we believe we have only begun to unlock the opportunities ahead of us," finished Mr. Hayne.

Net sales by brand and channel for the three and twelve month periods were as follows:

For the three months ended January 31, 2013, the gross profit rate improved by 650 basis points versus the prior year's comparable period.  The increase in gross profit rate was primarily due to a reduction in merchandise markdowns across all brands.  The Company also improved initial merchandise margins and store occupancy leverage, partially offset by deleverage in delivery expense primarily related to the increased penetration of the direct-to-consumer channel.  For the year ended January 31, 2013, the gross profit rate improved by 212 basis points versus the prior year's comparable period. The increase in the rate was primarily due to a reduction in merchandise markdowns.

As of January 31, 2013, total inventories increased by $32 million, or 13%, on a year-over-year basis. The growth in total inventories is primarily related to the acquisition of inventory to stock new and non-comparable stores and to support the significant growth in the direct-to-consumer channel. Comparable retail segment inventories increased 6% and comparable store inventories decreased by 3% as of January 31, 2013.

        For the three months ended January 31, 2013, selling, general and administrative expenses, expressed as a percentage of net sales, decreased by 7 basis points compared to the prior year period.  The leveraging of direct store controllable and shared services expenses was driven by the positive retail segment comparable sales.  This leverage was partially offset by higher equity compensation expense as a result of an equity compensation expense reversal in the prior year comparable period due to the departure of an executive officer.  For the year ended January 31, 2013, selling, general and administrative expenses, expressed as a percentage of net sales, increased by 24 basis points.  This increase was primarily due to the deleveraging of direct store controllable expenses driven by the negative comparable store net sales.

        The Company's annual effective tax rate for fiscal 2013 increased to 36.8% as compared to 35.9% for fiscal 2012.  The increase in the fiscal 2013 effective tax rate is partially due to certain nonrecurring state and foreign tax adjustments.       

        During the year ended January 31, 2013, the Company opened a total of 49 new stores including: 18 Urban Outfitters stores, 15 Free People stores, 14 Anthropologie stores, 1 BHLDN store and 1 Terrain garden center, and closed 2 Anthropologie stores.

Urban Outfitters, Inc. is an innovative specialty retail company which offers a variety of lifestyle merchandise to highly defined customer niches through 215 Urban Outfitters stores in the United States, Canada, and Europe, catalogs and websites; 180 Anthropologie stores in the United States, Canada and Europe, catalogs and websites; Free People wholesale, which sells its product to approximately 1,400 specialty stores and select department stores, 77 Free People stores in the United States and Canada, catalogs and websites; 2 BHLDN stores and a website and 2 Terrain garden centers and a website, as of January 31, 2013.

Management's fourth quarter commentary is located on our website at www.urbanoutfittersinc.com.   A conference call will be held today to discuss fourth quarter and year end results and will be webcast at 5:00 pm. EST at:  http://edge.media-server.com/m/p/ct7ov775/lan/en

        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 release may constitute forward-looking statements. When used in this release, the words "project," "believe," "plan," "will," "anticipate," "expect" and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. 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, lowered levels of consumer confidence and higher levels of unemployment, continuation of lowered levels of consumer spending resulting from the continuing worldwide economic downturn and related debt crisis, any effects of terrorist acts or war, natural disasters or severe weather conditions, availability of suitable retail space for expansion, timing of store openings, risks associated with international expansion, 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, the closing of any of our distribution centers, our ability to protect our intellectual property rights, risks associated with internet sales, response to new store concepts, potential difficulty liquidating certain marketable security investments, changes in accounting standards and subjective assumptions, regulatory changes and legal matters and other risks identified in  the Company's 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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