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Segment Reporting
 6 Months Ended
Jul. 31, 2011
Segment Reporting  
Segment Reporting

11. Segment Reporting

The Company is a global retailer of lifestyle-oriented general merchandise with two reporting segments—"Retail" and "Wholesale." The Company's Retail segment consists of the aggregation of its five brands operating through 392 stores under the retail names "Urban Outfitters," "Anthropologie," "Free People," "BHLDN" and "Terrain" and includes its direct marketing campaigns, which consisted of five catalogs and nine web sites as of July 31, 2011. The Company operates its retail stores and its direct marketing campaigns as a single operating segment. Net sales from the Retail segment accounted for approximately 95% of total consolidated net sales for the three and six months ended July 31, 2011 and July 31, 2010. The remainder is derived from the Company's Wholesale segment, which manufactures and distributes apparel to its retail segment and to approximately 1,400 better department and specialty retailers worldwide through its Free People brand.

 

The Company has aggregated its retail stores and associated direct marketing campaigns into a retail segment based upon their unique management, customer base and economic characteristics. Reporting in this format provides management with the financial information necessary to evaluate the success of the segments and the overall business. The Company evaluates the performance of the segments based on the net sales and pre-tax income from operations (excluding inter-company charges) of the segment. Corporate expenses include expenses incurred and directed by the corporate office that are not allocated to segments. The principal identifiable assets for each operating segment are inventories and property and equipment. Other assets are comprised primarily of general corporate assets, which principally consist of cash and cash equivalents, marketable securities, and other assets, and which are typically not allocated to the Company's segments. The Company accounts for inter-segment sales and transfers as if the sales and transfers were made to third parties making similar volume purchases.

The accounting policies of the operating segments are the same as those described in Note 2, Summary of Significant Accounting Policies, in the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended January 31, 2011. Both the Retail and Wholesale segments are highly diversified. No customer comprises more than 10% of sales. A summary of the information about the Company's operations by segment is as follows:

 

     July 31,
2011		      January 31,
2011		      July 31,
2010		  

Inventories

         

Retail operations

    $ 288,989       $ 213,420       $ 231,033   

Wholesale operations

      14,170         16,141         12,170   
  

 

 

     

 

 

     

 

 

  

Total inventories

    $ 303,159       $ 229,561       $ 243,203   
  

 

 

     

 

 

     

 

 

  

Property and equipment, net

         

Retail operations

    $ 622,695       $ 582,241       $ 555,461   

Wholesale operations

      3,493         4,105         4,484   
  

 

 

     

 

 

     

 

 

  

Total property and equipment, net

    $ 626,188       $ 586,346       $ 559,945   
  

 

 

     

 

 

     

 

 

  

 

     Three Months Ended
July 31,		     Six Months Ended
July 31,		  
     2011     2010     2011     2010  

Net sales

         

Retail operations

    $ 577,282      $ 522,225      $ 1,070,744      $ 977,035   

Wholesale operations

      35,194        31,217        66,777        57,186   

Intersegment elimination

      (3,295 )      (1,283 )      (4,321 )      (2,101 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Total net sales

    $ 609,181      $ 552,159      $ 1,133,200      $ 1,032,120   
  

 

 

    

 

 

    

 

 

    

 

 

  

Income from operations

         

Retail operations

    $ 88,182      $ 108,174      $ 151,150      $ 192,032   

Wholesale operations

      7,278        6,704        10,236        11,867   

Intersegment elimination

      (607 )      (119 )      (678 )      (184 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Total segment operating income

      94,853        114,759        160,708        203,715   

General corporate expenses

      (6,858 )      (7,890 )      (13,877 )      (14,635 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Total income from operations

    $ 87,995      $ 106,869      $ 146,831      $ 189,080   
  

 

 

    

 

 

    

 

 

    

 

 

  

 

The Company has foreign operations in Europe and Canada. Revenues and long-lived assets, based upon the Company's domestic and foreign operations, are as follows:

 

     July 31,
2011		      January 31,
2011		      July 31,
2010		  

Property and equipment, net

         

Domestic operations

    $ 517,430       $ 497,521       $ 490,176   

Foreign operations

      108,758         88,825         69,769   
  

 

 

     

 

 

     

 

 

  

Total property and equipment, net

    $ 626,188       $ 586,346       $ 559,945   
  

 

 

     

 

 

     

 

 

  

 

     Three Months Ended
July 31,		      Six Months Ended
July 31,		  
     2011      2010      2011      2010  

Net sales

            

Domestic operations

    $ 535,055       $ 495,980       $ 1,001,906       $ 929,657   

Foreign operations

      74,126         56,179         131,294         102,463   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total net sales

    $ 609,181       $ 552,159       $ 1,133,200       $ 1,032,120