Urban Outfitters, Inc. ($URBN)

Welcome to the 2026 Annual Meeting of Shareholders for Urban Outfitters, Inc.

Good morning. My name is Oona McCullough, Executive Director of Investor Relations for Urban Outfitters, Inc. And it's my pleasure to welcome you to the URBN Annual Shareholders Meeting. If you are logged on to Lumi, the virtual platform, you will see the agenda for today's meeting on your screen. The agenda for the formal portion of today's meeting has 3 major components. First, the election of 10 directors to serve until the 2027 Shareholders' Meeting. Second, a proposal to ratify the appointment of Deloitte as the company's independent registered public accounting firm. And third, to hold an advisory vote on approval of the company's executive compensation. If you have an 11-digit photo control number issued by AST and wish to vote during this meeting, you may do so by clicking the proxy voting site link on the left-hand panel of your screen. You must vote quickly because once we finish our introductions, the formal meeting will be called to order at which time the polls will close, and all voting will stop. You may also ask questions during the meeting, if you are registered with your 11-digit voter control number. Please refer to the messaging icon at the top of the left side of your screen, type your question into the text box, then click the send icon at the right of that text box. Before turning the meeting over to Dick Hayne, Chairman and CEO of Urban Outfitters Inc., I call your attention to the company's disclaimer that the following discussions may include forward-looking statements. Please note that actual results may differ materially from those statements. Additional information concerning factors that could cause actual results to differ materially from projected results is contained in the company's filings with the Securities and Exchange Commission. Please note, today, we will be speaking to our fiscal 2026 financial results on an adjusted basis, which does not include certain non-recurring adjustments. The effect of those items was detailed in our fourth quarter fiscal 2026 press release. Now I will turn the call over to Dick.

Thank you, Oona. It is my pleasure to welcome URBN shareholders, directors, employees, service providers and friends of the company to our virtual annual meeting. Our agenda today includes making brief introductions, conducting a formal business that Oona just outlined, discussing business results and finally, answering your questions. As mentioned, the polls will close after my introductions are complete. Now on to those introductions. Joining me to help conduct today's meeting and assist in answering your questions are Frank Conforti, Co-President and Chief Operating Officer of the company; Michael Silbert, General Counsel and Company Secretary; and Azeez Hayne, Chief Administrative Officer. And for today's meeting, Azeez will also function as the judge of elections. It is now my pleasure to introduce our Board of Directors. Besides myself, our Board consists of 9 directors. They are Ed Antoian, Kelly Campbell, Harry Cherken, Mary Egan, Meg Hayne, Amin Maredia, Wesley McDonald, Todd Morgenfeld, and John Mulliken. These 9 colleagues have provided me and the company with valuable advice, guidance and oversight during the year, and I thank them very much for their service. We also have one service provider, Felix Orihuela, joining us virtually. Felix works for Equiniti, our transfer agent and vote compiler. Felix is prepared to answer shareholder questions concerning the vote tabulation, should any arise. Thanks for joining us today, Felix. With that, my introductions are complete. The polls are officially closed, and I call the meeting to order. We will now conduct the company's formal business. The first item of formal business is a statement concerning the giving of notice and the presence of a quorum. Azeez, would you report on these 2 matters?

This meeting is held pursuant to printed notice stated and mailed to each shareholder of record on April 1, 2026. Sufficient votes are present in person or by proxy to constitute a quorum.

Thank you, Azeez. Since we have a quorum, we will conduct the 3 items of formal business that appear in the proxy statement, after which we will hear the vote on each item. The first of these 3 is the election of the Board of Directors. The 10 recommended nominees for directors standing for reelection are listed in the proxy statement provided to shareholders. They are Ed Antoian, Kelly Campbell, Harry Cherken, Mary Egan, Meg Hayne, Richard Hayne, Amin Maredia, Wesley McDonald, Todd Morgenfeld, and John Mulliken. Each nominee elected will serve a term expiring at the Annual Meeting of Shareholders in 2027. The next item of business is the appointment of Deloitte as the company's auditor for the year ending January 31, 2027. And finally, the third item of business is the nonbinding shareholder advisory vote on executive compensation. Azeez, can you please announce the voting results on each of these items.

All 10 directors listed in the proxy materials have been elected by a majority vote. The shareholders have ratified the appointment of Deloitte as the company's independent registered public accounting firm and the shareholders have approved the company's executive compensation in a nonbinding advisory vote.

Thanks, Azeez. With that, all items of formal business as outlined in the proxy have been addressed by the shareholders. The actual vote from today's meeting will be reflected in a Form 8-K filing in the next few days. As always, the Board will review and carefully consider shareholder feedback as reflected by the voting results. Please note that the company has prepared and issued an annual report on Form 10-K. This report outlines the company's recent operating results and financial condition. The 10-K is available online at urbn.com. With that, the formal portion of today's meeting is now closed. And so I'll move on to a brief business review, including a discussion on recent operating results. So looking back on our last fiscal year, which ended January 31, I couldn't be prouder of our teams and what they are able to accomplish. For the year, we delivered impressive 11% revenue growth adding over $600 million to reach record sales of $6.2 billion. At the same time, our gross profit margin grew by 126 basis points despite incremental tariff headwinds. This drove a 28% increase in operating profit and lifted earnings by 35% to $5.44 per share. Record sales and profits made FY '26 a truly historic year for URBN. Fortunately, fiscal '27 has started out equally strong. We recently reported record first quarter results with revenue again growing by 11% and EPS increasing by 12%. We maintained our strong execution by delivering a 9.4% operating profit despite ongoing issues around tariffs, freight costs and gas prices. Fortunately, our customers continued to show resilience. We saw no signs of a demand slowdown. In fact, customers were eager for fresh spring fashion and our teams delivered. From compelling assortments to standout store experiences, inspiring marketing and new innovations in our subscription business, we exceeded their expectations. The results, positive comps across every brand and every segment. This performance speaks volumes about the strength of our strategies, the quality of our execution and the appeal of our brands. Most of all, it affirms the talent of our leaders and their teams. We're attracting new customers, keeping our loyal ones and growing our market share across the board. Each brand plays a valuable role in the URBN portfolio. Anthropologie continues to grow revenue and deliver healthy double-digit operating margins. Free People is delivering exceptional results with Retail segment comps near double-digits and outstanding margin performance. FP Movement is an even stronger growth vehicle with double-digit sales growth and superior margins. FP Movement now operates over 90 stores across North America and expects to open more than 20 new stores in FY '27. Nuuly, our women's apparel rental business is our youngest and fastest-growing brand. It recently reached a milestone by surpassing 500,000 active subscribers, is nicely profitable, gaining brand awareness and showing the potential to scale meaningfully. Nuuly is one of the most exciting high-growth apparel concepts in the market today. Urban Outfitters in North America continues its important turnaround journey, while the brand in Europe continues to deliver double-digit comp sales. Together, they returned the brand to profitability for fiscal 2026 and are showing continued momentum in the first quarter. All-in-all, I'm delighted with how our brands are performing. Yes, we're managing a more complex tariff and freight environment than a year ago, but our teams have demonstrated remarkable discipline in their mitigation efforts, and we expect headwinds to ease as we move through the year. Based on what we know today, we believe we can continue to grow revenue and expand margins for the full year and beyond. We're confident URBN is well positioned for continued success. That concludes my prepared remarks. I will now pause and ask Oona if there are any questions from our shareholders.

Dick, at this time, we have no questions.

All right. Thank you, Oona. Since there are none, the URBN 2026 Annual Shareholder meeting now stands adjourned. Thank you for your interest and your participation.