Glen Senik - CEO Dick Hayne - Chairman John Kyees - CFO Ted Marlow - President Urban Outfitters Brand

Kimberly Greenberger - Citigroup Global Markets Brian Tunick – JP Morgan Jeff Black - Lehman Brothers Roxanne Meyer - Oppenheimer & Co. Adrienne Tennant – Friedman, Billings & Company Christine Chen – Needham & Company Samantha Panella – Raymond James & Associates Robin Murchison - SunTrust Robinson Humphrey Lauren Levitan - Cowen and Company Liz Pierce – Roth Capital Barbara Wyckoff – Buckingham Research Crystal Kallik – DA Davidson & Company Dana Telsey - Telsey Advisory Group Marni Shapiro – The Retail Tracker Richard Jaffe – Stifel Nicolaus Janet Kloppenburg – JJK Research Holly Guthrie – Janney Montgomery Scott Liz Dunn - Thomas Weisel Partners Betty Chen – Wedbush Morgan Securities Jennifer Black - Jennifer Black & Associates [Tanya Daconian] - William Blair & Co.

Good day ladies and gentlemen, and welcome to the Urban Outfitters Inc. first quarter fiscal year 2009 earnings conference call. (Operator Instructions) The following discussions may include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Please note that actual financial results of the company for the periods being discussed may differ materially from the financial results projected or implied in the forward-looking statements. Additional information concerning factors that could cause actual financial results to differ materially from projected results is contained in the company’s Annual Report on Form 10-K and in other documents filed by the company with the Securities and Exchange Commission. The company disclaims any intent or obligation to update forward-looking statements. No recording or rebroadcast of this call is permitted without the company’s express written permission. I would now like to introduce your host for today’s conference Mr. Glen Senik, CEO; sir you may begin.

Good morning and welcome to the URBN quarterly conference call. I am joined today by Dick Hayne, our Chairman; John Kyees, our Chief Financial Officer; Ted Marlow, President of the Urban Outfitters Brand; and our senior executive staff. Meg Hayne, President of the Free People brand is traveling, so the team and I will be presenting on her behalf. Earlier this morning, the company issued a press release outlining the financial and operating results for the three month period ending April 30, 2008. I will begin today’s call by reading prepared commentary regarding our performance, then the team and I will be pleased to answer any questions you may have. The text of today’s conference call can be found on our corporate website www.urbanoutfittersinc.com. I am extremely pleased with the exceptional results our team produced for the first three months of our fiscal year. Total company sales for the quarter increased by 25% to $394.3 million, our second highest quarter in history. Total company comparable store sales grew by 10% with consistent performance across all three brands; Anthropologie, Free People and Urban Outfitters achieved comp increases of 10%, 19% and 10% respectively. Direct to consumer sales surged by 34% with just 3% additional catalog circulation, with all three brands contributing meaningfully to the result. Free People wholesale revenues increased by 22%, our 17th consecutive quarter of double-digit sales growth. Operating income grew by 75% to $62.9 million, or an operating margin of 16%. Finally, the company earned $42.6 million for the quarter, a 45% increase from the prior year resulting in earnings per diluted share of $0.25. I’ll now go into more detail on each of the metrics of our business starting with sales. New and non-comparable store sales increases accounted for $36 million in the quarter, or 45% of the total quarterly growth. The company opened 12 new stores in the period; one Anthropologie store, three Free People stores, seven Urban Outfitters stores and our first Terrain garden center. The company’s comparable store performance was slightly stronger in February and April than in March. Considering that URBN operates on a calendar as opposed to 4/5/4 basis, the company faced Easter in April, which makes our strong April performance particularly impressive. At Anthropologie, 87% of the stores had comp positive sales for the quarter. The Northeast region was strongest, followed closely by the West Coast, then the Midwest and South. Performance by location type was relatively even with the exception of free standing stores which while positive, chased the group. At Free People with just eight stores in the comp base, it is not yet appropriate to highlight regions or store types. What we can say however, is that all stores were highly productive. At Urban Outfitters, 85% of the stores had comp positive sales for the quarter. Like Anthropologie, the Northeast region fared best while the other regions, the West Coast, Midwest and South performed relatively evenly. Performance by location type was relatively similar as well with the exception of lifestyle centers which were flat on a comp basis for the quarter. The company’s comparable store sales gain was driven largely by transactions which increased by 7% in total for the quarter, with gains of 9%, 10% and 5% at Anthropologie, Free People and Urban Outfitters respectively. Driven by a lower weighted mix of sale merchandise, the company’s average unit selling price increased 7% in total, down 1% at Anthropologie, up 10% at Free People and up 11% at Urban Outfitters. Accordingly units per transaction decreased by 4% in total, up 2% at Anthropologie, and down 1% and 7% at Free People and Urban Outfitters respectively. I’m delighted to report that all merchandise divisions were comp positive, with accessories setting the pace at all three brands. Further each brand experienced meaningful trends in the women’s apparel business. I’d like to take a minute to comment specifically on the Urban Outfitters brand. I’m pleased that Ted and his team have continued to successfully execute on the strategy we set forth almost a year ago which included increasing the style count while keeping the SKU count flat, offering a more balanced and eclectic assortment; investing in our in-house design group and designer collaborations with the goal of increasing our own brand penetration and decreasing the amount of private label. Applying a more systematic approach to managing our assortment and receipt flow, thereby increasing turn and inventory freshness and reducing markdowns. And utilizing design concepts to synchronize the design and buying process, resulting in a cohesive store presentation. The Urban customer is recognizing the change and so is the press. Let me read an excerpt from an article that ran in the LA Times on May 4th, 2008: “Urban Outfitters has the formula of artsy, angst-ridden fashion down to a science. Plaid tops and skinny jeans? Check. Slouchy ankle boots and Wayfarer-inspired eyewear? Obviously. Throw in one of the store’s signature fedoras and your hipper-than-thou ensemble is Echoplex-ready. But this month, Urban is upping its fashion game by partnering with contemporary label Geren Ford on a line of sweet sailor dresses, jackets and feminine tops, the first in a string of collaborations that will include Paul & Joe and Steven Alan. The Ford line doesn’t hit stores until mid-May, but judging from the rest of the stock in stores now, Urban Outfitters has already started to trade its Silver Lake aesthetic for runway polish.” This is just one of the many articles I’ve read about Urban Outfitters recently. There’s still a great deal of opportunity at the brand, but the turnaround is well under way and the business has excellent momentum. Now let me turn your attention to our direct to consumer business. Direct sales for the quarter increased by 34% to $58.2 million, driven by a catalog circulation increase of just 3%. The penetration of direct to consumer sales to total company sales increased from 13.8% to 14.8% versus the same period last year, reflecting what we believe is a continuing paradigm shift in the way the consumer is shopping. Our website visits were up 31% in the quarter to 15.3 million visits, that’s a gain of 3.6 million visits over the same quarter last year. All three brands continue to innovate in our direct to consumer business. For example, Anthropologie began shipping internationally last quarter, Free People introduced product reviews and Urban Outfitters expanded its use of video, generating more than 17,000 YouTube views on its most successful clip. Finally Free People wholesale continued its tremendous sales momentum increasing quarterly sales by 22%. The increase was driven by an 18% increase in units and a 4% increase in average unit price, with department stores growing faster than specialty stores for the quarter. Bookings for our summer and fall deliveries are nicely ahead of plan, and we are very pleased with the initial reaction to both We the Free and Intimately Free People. I’d like to now turn your attention to gross margin, operating expense and income. Total company gross margin increased 444 basis points for the quarter to 40.2%, marking the first time in nine quarters that the gross margin exceeded 40%. This performance which was nicely favorable to plan, was driven largely by reductions in our markdown rate, improvements in our initial margin and the leveraging of store occupancy expense. Total company comparable inventory was down 3% at the quarter’s end, with a 2% decrease at Anthropologie and a 5% reduction at Urban Outfitters. As is our custom we dynamically plan and manage inventory to weeks-of-supply as opposed to a set plan. We change the plan as often as needed based on trend and as a result we believe we are appropriately positioned to maintain our positive comp trend. The company’s operating expense leveraged seven basis points in the quarter to 24.3%, principally due to the leveraging of direct store controllable expense. It is important to note that several non-recurring expenses impacted the company’s SG&A for the quarter, including approximately $2.6 million of charges related to the Terrain opening and the launch of Leifsdottir. The company’s income from operations for the quarter increased 75% to $62.9 million or a 16.0% operating margin, with earnings per diluted share growing from $0.17 to $0.25 versus the same period last year. The company’s tax rate for the quarter rose from 22.2% to 35.7%. Excluding one-time federal tax incentives, the company’s estimated quarterly tax rate in fiscal 2008 would have been 36.2% and the earnings per diluted share would have been $0.14. Before I close I’d like to bring you up to date on several of the initiatives I discussed on our last call. First at Anthropologie, Leifsdottir, Anthropologie’s wholesale brand, will begin to ship at the end of June. The market reaction to the line has been outstanding, and the brand will be distributed in many of the best doors in the country. Anthropologie tested a shoe assortment this past March in 23 stores. The business has run ahead of plan virtually every week, so we will expand the assortment to an additional 20 doors by early fall. The brand is committed to its European expansion. The Anthropologie direct channel began shipping to Europe at the very end of the fourth quarter and the business has performed above expectation. The team continues to target mid- 2010 if not earlier for its first European store opening. Finally Anthro, the brand’s CRM program continues to gain traction. There are now more than 400,000 members in the program and we are about to begin testing a variety of benefits. At Free People, the brand has led the way in bringing constant newness to the floor with its innovative 18 deliveries per year of the collection business. We certainly see the result both in our own stores and with our customers in the brand’s sales and productivity performance. Intimately Free People, the brand’s intimate’s line, will ship to more than 300 doors this year including Saks Fifth Avenue, Bloomingdale’s, Nordstrom, Fred Segal, M Frederic and BareNecessities.com. We the Free, Free People’s boy-inspired newest line has shipped to more than 200 doors including Cusp, Nordstrom, Lisa Kline, Beehive, Wishlist and 24 doors overseas including Barney’s Japan. Finally the wholesale website will launch in early fall allowing our more than 1,700 specialty accounts to place and track their orders online. The site will have real time inventory, and will enable the sales team to communicate trend information, best sellers and other insights. At Urban Outfitters, the brand reduced their weeks of supply by approximately three weeks in the first quarter and as a result dramatically improved their inventory productivity and the overall look of the store. Urban Outfitters increased their own brand penetration to 25% in the quarter. Equally important are the statistics; own brand product turned two weeks faster than the division average, achieved a maintained margin over 400 basis points higher than the division average and had an average unit retail that was 35% higher than the division average. Finally the brand executed a series of vendor collaborations. For our back-to-school selling season, look for Lark & Wolf by Steven Alan; Hawks by Geren Ford; Play by Charlotte Ronson; Rendezvous by Paul & Joe Sister; Grey Antics by Grey Ant; Anderson & Lauth from Reykjavic; JV Converse; Scotch & Soda; Canterbury of New Zealand; and Bing Bang. Lastly I’d like to turn your attention to Terrain. The company opened our first Terrain garden center on April 18th. The site is comprised of 19,000 square feet under roof housing a vast array of indoor and tropical plants, garden equipment, pots, garden accessories, furniture, found objects, gifts and a café. Another 4,000 square feet devoted to landscaping services, and approximately 3 acres devoted to annuals, perennials, shrubbery, trees and outdoor furniture, fountains, sculpture and accessories. The Terrain team’s objective was to reinvent the garden center and accomplish their objective they have! The customer reaction to our store has been overwhelmingly positive and I encourage you to come and visit. In conclusion, our over-arching goal has been constant and simple; to grow revenue by at least 20%, to grow profit at a faster rate than sales, and to reach a minimum of 20% operating margin. We have achieved our growth goals consistently over time and we remain confident that we will continue to do so. Our definition of the company’s core competency has also been constant to create emotional connections with our customers through the creation of compelling, differentiated experiences. Our product offering is critical, but we believe the experiential aspect of our strategy is what truly differentiates us from other retailers. We believe the company has built three of the most recognized, distinct and compelling brands in the industry; three brands that have consistently inspired a profound level of customer loyalty. Equally exciting each brand has a significant opportunity to grow through multi channel expansion and brand extensions and we now have Terrain joining the Urban portfolio to provide another means of growth. Given the economic turbulence over the last several months I am particularly proud of the company’s performance for the quarter. This outcome is the result of a truly exceptional team, the URBN employees, all of whom have tremendous focus, creativity, discipline and competitive will. I know I speak for the shareholders when I say that I am profoundly humbled by their talent and so very appreciative of their extraordinary commitment. As always, the leadership team and I couldn’t be more excited about the prospects ahead and we look forward to continuing to inspire our customers and reward our shareholders and employees. I will now open the call to questions. As we did on the last call I’d like to ask each of you to limit yourselves to one question. I respectfully apologize in advance, if you ask more than one question, we will respond only to your first query. Thank you.

(Operator Instructions) Your first question comes from the line of Kimberly Greenberger - Citigroup Global Markets Kimberly Greenberger - Citigroup Global Markets: I was hoping John that you could give us the basis point around the margins, obviously with markdowns coming as much as they did, we’re just trying to figure out how much margin you’re getting from all of the different components. I just had a clarification, the one-time expenses on Terrain and Leifsdottir, do you expect any of those expenses in that $2.6 million bucket to exist in the second quarter and/or the third quarter this year?

In terms of the margin comparisons we generally don’t want to give that kind of detail. I will tell you that the bulk of the impact was markdowns without question, but we certainly got leverage from a 10% comp on our store occupancy and his comment was we had improved initial markups. From the SG&A increase the majority of that, in fact I think there’s probably over $4 million in the quarter that will not be repeated in future quarters.

Your next question comes from the line of Brian Tunik – JP Morgan Brian Tunik – JP Morgan: My question is on the Urban division, obviously congratulations, very nice improvement there, but could you perhaps give us some color by category on men’s apparel versus women’s and I think you mentioned accessories led the way and conversely what are some of the [laggers] in this business that you see as an opportunity as we go through the year?

Regarding the Urban question, we don’t really share much color in regard to category performance. The callouts that Glen made in the letter are pretty much spot-on in the performance. We did have nice comp performance in each division, accessories was very strong for us. The one thing I would share with you, whereas in the past we’ve had some difficulty getting all of our accessory categories to perform for us. Out of essentially 12 categories that we merchandise there, all performed nicely positive. More importantly the women’s apparel side saw a continued improvement as we came through the quarter and the other categories of the business as well gave more than their fair share.

Your next question comes from the line of Jeff Black – Lehman Brothers Jeff Black - Lehman Brothers: I guess whoever wants to take it, when we add Terrain and Leifsdottir, what are we thinking is achievable in terms of operating margin over the next couple of years for both of those initiatives?

I believe Terrain will have solid operating margins. Its going to be awhile before it obviously gets critical mass to be able to cover the corporate expense and that’s why we’ve been saying for some time that we think it’s about a $2 million P&L hit annually for the first two or three years; probably $500,000 a quarter with the exception of this first quarter where we had start-up costs that were unique. So that I think is appropriate. I think Leifsdottir will be the same kind of situation. It’s going to take some critical mass. Its been well received so we feel pretty positive that it’ll have reasonable operating margins for a wholesale business but they still will have some expenses that will have to be dealt with on a critical mass basis. Jeff Black - Lehman Brothers: Do you think sort of a mid-teens margin is achievable on both or is it north of that John?

It’s a toss-up right now. I think certainly as we expect to company to do 20%, we expect this to approach that at some point in the future, both concepts.

Your next question comes from the line of Roxanne Meyer - Oppenheimer & Co. Roxanne Meyer - Oppenheimer & Co.: I just had a question on the intimates business, I’m noticing over time its been taking up more space in the Anthropologie stores, the one I go to is on 16th Street and really its expanded on that bottom level, I’m just wondering if you could let us know how its doing, where you think it can go, how big it can be and how you would describe the customer who purchases it in terms of the size of your demographics?

The intimate’s customer at Anthropologie is the same customer who shops the rest of the store. The intimates business has been excellent for the brand for quite some time. As I mentioned in the call all of the divisions in all of our businesses were comp-positive and certainly intimates, I would include intimates with that. I also mentioned that the intimates business at Free People is doing very well and we’ve had a tremendous reaction with 300-door distribution in its first full year of business. So we feel there’s wonderful opportunity for the intimates business in all of our brands and we think we can position it uniquely in each brand.

Your next question comes from the line of Adrienne Tennant – Friedman, Billings, Ramsey Adrienne Tennant – Friedman, Billings, Ramsey: My question is can you give any comment on May trends, month-to-date, I know there’s been some talk of an improvement in trends since April time period, and if the answer is no then can my second question be can you talk about the direct sourcing opportunity; how much and when.

The first part of your question, our business continues to run ahead of our modest single-digit comp plan, which is what we’d be prepared to say right now. We’re making very, very good progress, in fact I just got back from a wonderful trip in the Far East last week. We’re right on schedule with our CTM initiative. We’re cutting weeks out of the calendar. We’re reducing factories. We’re very, very pleased with the costs we’re getting with the improvements in product that we’re getting. So we’re right on track with that.

Your next question comes from the line of Christine Chen – Needham & Company Christine Chen – Needham & Company: I wanted to ask, so Anthropologie faces difficult comparisons for the rest to the year, wondering if there were missed opportunities last year that you can share with us that may be you’re focused on this year.

I think that as we’ve said, the average comp for Anthropologie over the last five years has been 10%. I actually haven’t looked at the number for the last 10 years but it’s probably not too far from that. So I think we’re kind of our most self-critical audience and we always think there’s opportunity and we certainly don’t plan for 10% comps but if history can repeat itself, it’s something that we could, if we’re lucky, we could see. Christine Chen – Needham & Company: Were there any categories in particular?

You know I think that hindsight is always 20/20 so of course there are things that we could have done better in every part of the business from the assortment to the inventory flow to the way we run our stores, visual merchandising, marketing, etc. and I think we deliver the kind of quarter we delivered because in all of our brands we have just an incredible amount of consciousness, a very, very kind of brutal sense of looking at the facts and the details and we pick apart every lever in our business and we certainly don’t always get it right, but we get it right more often than not. I think that also we have very stable teams, every season is an iterative process so it builds on the season before. And I think that’s why we’ve been able to deliver the kind of comp performance over time that we have and we certainly plan low single-digits but I’m hopeful that we can beat that.

Your next question comes from the line of Samantha Panella – Raymond James & Associates Samantha Panella – Raymond James & Associates: John I just wanted to get an update, the store openings scheduled by quarter for the remainder of the year?

We expect much more balanced openings this year than we’ve ever had historically. With our 11 stores in the first quarter, actually 12 with Terrain, and then 12 next quarter, probably 15 Q3 and probably 12 in Q4. So and that may add to more than the 45 number. We’re constantly shifting openings and deciding based on occupancy situations and how quickly we can get possession. Those should be pretty good ballparks.

Your next question comes from the line of Robin Murchison - SunTrust Robinson Humphrey Robin Murchison - SunTrust Robinson Humphrey: In terms of overseas and sourcing, especially as regards to the opening of the Hong Kong office, what are your thoughts around that at this point?

A lot of that’s kind of key strategic information that I really wouldn’t want to share on a conference call, but the goal has always been to compress the calendar, improve costs, so that we can get the right product in the right place at the right time. It’s a multi year effort. It’s been led by [Barbara Roseus] who has worked for the company for nearly 10 years. She’s doing an exceptional job. There were four of us who travelled last week to the Far East to work on this. I think we were in something like nine cities in six days. It was a spectacular trip and as I said I feel very, very good about the effort on all fronts. We’re interviewing great people. I love the factories that we were in. I think the product that’s in the store now looks terrific. I’m happy with what we’re paying for it. I’m extremely happy with the flexibility that we’re seeing. We’re just, on all fronts, we’re making a lot of progress there.

Your next question comes from the line of Lauren Levitan - Cowen and Company Lauren Levitan - Cowen and Company: Glen could you talk about, you mentioned that for both Urban and for Anthropologie there were a handful of stores that weren’t comp-positive and I’m curious if you’re seeing cannibalization as you had additional stores in existing markets or if there’s any regional pockets of weakness that are worth calling out?

I would say I think in our total store base, I’m aware of cannibalization in one instance so that’s really not something that we see. We just don’t have enough stores in our base to see it and we’re very disciplined in terms of the way we locate stores to avoid it. In terms of geographical difference, I almost am hesitant to even share the total numbers with you because I think they’re pretty meaningless. When I kind of deep-dive and look at the granular information to the extent that we have an issue its usually there was construction in front of the store, or we had turnover at a store management level, I really, unless there’s significant weather nuances by region we don’t really see differences in our regional performance. Lauren Levitan - Cowen and Company: So the few that weren’t positive, there was really nothing significant to callout.

I think with 10% comps to have 86%, 87% of your store base positive is pretty typical and I think when you look at the 13% or 14% of the stores that weren’t positive, nine out of 10 times its going to relate back to management.

Your next question comes from the line of Liz Pierce – Roth Capital Liz Pierce – Roth Capital: Ted I have a question for you about all the different branded partners, the names that Glen read out, are these going to be relatively small and are they kind of just little boutiques that will appear on a continuous basis?

Relatively small but developments that take place on an ongoing basis with the partners that we’re doing business with. The other thing that wasn’t part of the commentary, by and large the majority of those are handled across the company on an all-store basis so its not just a handful of stores that will be involved in those collections and the initiative.

Your next question comes from the line of Barbara Wyckoff – Buckingham Research Barbara Wyckoff – Buckingham Research: Can you talk about the recent and upcoming systems initiatives, planning out allocations, CRMs, some of the kinds of things.

Absolutely, we have Calvin Hollander who heads us that area, so I will ask him to tackle that question.

A couple of things, the one thing that we are doing at the planning initiative, we are now [inaudible] is going well. We plan to [fine tune that towards the next couple of weeks and begin] rolling it our more aggressively. Other initiatives we have, we just went live with an initiative whereby we hooked automatic warehouse facility to our wholesale business, with efficiencies there. We are supporting [Barbara Roseus] and the whole CTM initiatives, our concept to market. So quite a few things going on and obviously supporting on the CRM and new initiatives as they come up.

Calvin and his group also just did another extraordinary job with the launch of Terrain. From day-one there was not one single issue, it was just spectacular installation. So thank you very much.

Your next question comes from the line of Crystal Kallik – DA Davidson & Company Crystal Kallik – DA Davidson & Company: Glen would you talk a little bit, the web business continues to certainly expand pretty dramatically, how would we think about the long-term operating margin expansion there as you continue to leverage your expenses?

The margin in all three direct businesses was better than the margin for the company in whole so it’s a business that we’re very excited about gaining penetration on. We internally we like to say its advertising that we make money on so we’re very, very bullish on the business. Crystal Kallik – DA Davidson & Company: Are there any thought as far as how far can a direct business model operating margin expand?

There’s a lot of thought about it but I’m not prepared to talk about it on the conference call but we do think that the direct business can be significantly more profitable than the bricks-and-mortar business.

Your next question comes from the line of Dana Telsey - Telsey Advisory Group Dana Telsey - Telsey Advisory Group: Glen can you talk a little bit about on the gross margin side, the gross margin opportunities given the impressive increases you saw this quarter, as you bring in more private label product and expectations there.

We still believe that there’s initial margin opportunity and I think that we’ve been talking about somewhere in the neighborhood of 200 bits of IMU opportunity for the last several years. I think we’ve achieved that and we’re still talking about that kind of level of opportunity, so that’s number one. Markdown opportunity, we had a dramatic reduction in markdowns this quarter relative to last but I think that there is ways we can go in reducing markdowns. The whole CTM initiative, I’ll repeat myself, it’s all about getting the right product in the right place at the right time. So its about buying less up front, its about allocating less up front, its about delaying decisions until the last possible moment so that we can have the highest percentage of regular price sales as possible. I think that we’ve made good progress but I think we have a lot of headroom to go.

Your next question is a follow-up from the line of Kimberly Greenberger - Citigroup Global Markets Kimberly Greenberger - Citigroup Global Markets: Glen I just had a follow-up question for you, one of the things that we commonly hear from investors is Anthropologie anniversary’s really tremendous success starting here in the second quarter and how do you think about anniversarying those really strong numbers last year, what are the strategies that your buyers, your merchants and your store people are putting into place to anniversary that success?

I want to reiterate that the total company’s averaged nine comp over the last five years, Anthropologie 10 comp over the last five years so this is not the first time that Anthropologie has come up against difficult comparisons. And it really goes back to what I said earlier, we look at every single lever in the business so first and foremost the merchants, I tend I guess to look at merchandise first. So I dissect every category we’re in and we cull what’s not productive and we try to add inventory to areas or categories that are productive and that’s a very, very iterative involved process. We look at the way we flow inventory. Did we miss receipts in a given week? Did we flow too many receipts in a given week? We’re certainly constantly improving the way we allocate product. We are, we have spoken about this before, we’re attributed down to a very kind of finite level so we can literally not only allocate size selling by location but color selling, style selling and so on and we’re constantly getting better at that. We try to get better at the way we market the brand. We try to get better at the outfits that we put on the forms. At the way we merchandise the store from front to back. We’ve learned a lot about selling in the store. I think now we have an Anthropologie stylist in about 25 stores and that’s doing very well. The CRM initiative, I said we have 400,000 names, that’s from zero six months ago. And we’re starting to communicate to those customers and we’ll learn, as we do that, we’ll learn about what they value and what incents them to buy. So it’s not just one lever. I think relying on one lever would be a very dangerous thing. Its looking at every single lever in the business and having entrepreneurs who are responsible for each of those levers really own that business and continual, and its all about continual improvement.

Your next question comes from the line of Marni Shapiro – The Retail Tracker Marni Shapiro – The Retail Tracker: I have a question, it’s about Free People, but I guess it would relate to Leifsdottir as well, can you talk a little bit about the distribution of the brand. You have been very careful to keep a tight hold on that and although I’ve seen it in a few stores you didn’t want to necessarily be in, I’m curious how you think about that going forward and has your team been able to really hold their hands and say no to overdeveloping the brands in some of the places whether its Bloomingdale’s and Nordstrom and I guess it kind of holds true for Leifsdottir, how do you attack that in an environment where you own a brand that’s doing well when so many others aren’t?

We’re in 1,700 doors in Free People and that number really hasn’t changed very much in the last several years and we’re really in four majors at Free People and that number hasn’t changed very much. I think I mentioned on the last call that virtually 100% of the increase in Free People has come from improvements in productivity in existing accounts. And that’s something that’s very, very important to us. We believe that scarcity is a good thing when it comes to distribution. Certainly at Leifsdottir I said previously that we will not distribute Leifsdottir in more than 100 doors initially and that’s very much the case. So it is a strategic discussion that the managing director in the case of Free People, Meg. [Chrissy Meehan], I get involved in. In the case of Leifsdottir its [Catherine Dananberg, Wendy Worksberger], myself. And we absolutely do hold hands and discipline ourselves and we just have to, like in our own stores, we have to figure out how to do more business with our customers’ year in and year out because we will not grow our business through growing distribution.

Your next question comes from the line of Richard Jaffe – Stifel Nicolaus Richard Jaffe – Stifel Nicolaus: One questions for John Kyees about the cash and the cash and investments that are piling up and your plans for use of cash, I know buybacks have been discussed and sort of put on the back burner, wondering what your thoughts are today. And then looking down the road of further, private label brands or home brands to be developed inside the Urban store.

Richard which question would you like us to answer? Richard Jaffe – Stifel Nicolaus: The second one.

We have a couple of projects going on with members of our design staff that could have legs beyond simply retail; its product that we’ll be delivering in the back half of the year. We are desirous as well as we go forward in the out months and again I’m talking about physical 2010 so calendar ’09 projects, we’re desirous as well to get our toe in the water on opportunities on the wholesale side of things. And we’re planting a few seeds to learn from that as we go forward through the balance of this year. In addition to that, on the private branded product that we’re working on, the group has done good work around developing brand profile for all of the development that’s taking place within the division, collateral packages for trim and labeling on that product has been taken care of and it will start to appear at point-of-sale in the stores. And we plan on that particular element in our business increasing and becoming even more productive as we go forward.

Your next question comes from the line of Janet Kloppenburg – JJK Research Janet Kloppenburg – JJK Research: Glen, I was impressed that you continued to endorse your 20% operating margin goal and given all of the development, new concept development, Leifsdottir and Terrain, I think the likely introduction of another concept this fall, is that something that we should be thinking about longer term or is that an operating margin goal that you think is achievable in the next let’s say 12 to 18 months?

I don’t think we would want to get too specific on that. I think it could be viewed as the forward-looking statement but I think within the next several years is maybe about as specific as I’d get. I think as John said they’re were in excess of $4 million of non-recurring charges to the current quarter, everyone can do the math on that and figure out what the margin would have been had we not had those and you heard my response earlier with regard to IMU opportunity, markdown opportunity. So we’re feeling very confident about our ability to get to the 20% in the reasonable future. Janet Kloppenburg – JJK Research: Okay but there will still be some ongoing one-time expenses won’t there John for Terrain and for Leifsdottir, $2 million annually for Terrain I think you said?

There will be and that’s built into our model. We would assume we’ll be able to cover those through other vehicles.

We’ve been investing in our business every year in the 14 ½ years I’ve been with the company so I don’t think this year is any different than years past.

Your next question comes from the line of Holly Guthrie – Janney Montgomery Scott Holly Guthrie – Janney Montgomery Scott: Glen you called out accessories as being an important part of the Q1 business, could you tell us what percent of your sales accessories was across all the brands and kind of compare that to last year’s Q1 and if you don’t want to tell us that, but could you talk about mix and how the mix impact your gross margin.

We don’t feel comfortable getting that specific, what I would say is that in terms of gross margin it really differs by brand. At Anthropologie the gross margin across merchandise categories are relatively equal. At Urban I think the accessory margins are slightly higher than the women’s margin. At Free People I think they’re slightly lower than the women’s margins. I would say for the total company it’s pretty neutral and I don’t think if you’re trying to model gross margin, I don’t think that’s where you want to go. I think you just want to look at the total numbers.

Your next question comes from the line of Liz Dunn - Thomas Weisel Partners Liz Dunn - Thomas Weisel Partners: I just had a point of clarification, it sounded like John addressed 51 openings this year and the release says 45, which is it?

Well as we haven’t specified as I said when I made that comment, we have a number of stores on our list at this point in time. Openings change due to possession dates and so forth. Liz Dunn - Thomas Weisel Partners: You would suggest we model 45?

Forty-five is a safe number and we can’t tell you that it won’t be above that.

Your next question comes from the line of Betty Chen – Wedbush Morgan Securities Betty Chen – Wedbush Morgan Securities: I was wondering Glen if you can talk a little bit more about the CTM program, it sounds like you’re definitely in the early stages of it. Could you tell us roughly what percent of your buys are currently benefiting from the program and then also if that will already help you with your second quarter inventory plans and how we should think about that.

Again I don’t want to go into too much detail on the CTM because I think a lot of it is competitive information that I wouldn’t want to share in this venue. The goal is to compress the product line so that we can get the right product in the right place at the right time. I think when you look at the inventory reductions both at Anthropologie and especially at Urban, what you’re seeing is in part due to the improvements we’ve made with our sourcing. I think I spoke on the last conference call about a key item at Anthropologie that unexpectedly came in and sold 40% or 45% in the first week and I congratulated [Barbara Roseus] and her team for literally getting the brand back in inventory in two-and-a-half weeks. So when you have that kind of flexibility or reaction time, it has a pretty profound impact on the open to buy. And to point of clarification, I wouldn’t say that we’re early stages in CTM, I would say that we’re probably 40%, 45% of the way through. We’ve made a lot of progress in the last 18 months. We started, we identified this several years back and we started working on it as a group about 18 months ago and I’m very, very pleased with where we are in our status. As Calvin said we’re in the midst of a software initiative, I think Calvin will go live on the software by the end of the year; towards the end of the year, beginning of next year. I think that will help a lot. Its and enabler, it’s not the driver but it’s an enabler. We’ve made as I’ve mentioned earlier we’ve done a good job reducing factories. We’ve had great people in place so I’m very, very pleased with the progress we’ve made. Betty Chen – Wedbush Morgan Securities: I don’t know if I can ask a clarification, when John mentioned earlier the $4 million that will not be repeated in the first quarter for Terrain and I think Leifsdottir, is there any way you can split that up for us so we can kind of get a sense of were the investments in each concept?

We can speak to that later on a separate call. We don’t want to really get into a lot of detail on that but we can talk later.

Your next question comes from the line of Jennifer Black - Jennifer Black & Associates Jennifer Black - Jennifer Black & Associates: You mentioned in your prepared remarks that lifestyle centers, that the comps were flat and I just wondered if you had any thoughts about that Glen and is that an opportunity going forward?

What I actually mentioned was they were flat at Urban Outfitters, at Anthropologie they were with the group and again I’m hesitant to mention those kinds of things because if you drill down into the details its typically a management issue. I think I said that we have one store that I can think of that’s been cannibalized in our entire company and that one store happens to fall in the lifestyle grouping at Urban Outfitters so I think that had an impact. I don’t think there’s anything meaningful to take away, I think we believe in the lifestyle concept, lifestyle center concept, we’ll continue to open stores in them and that’s it.

Your final question comes from the line of [Tanya Daconian] - William Blair & Co. [Tanya Daconian] - William Blair & Co.: What growth pace do you believe is reasonable to expect for the wholesale sales for the rest of the year?

Well as I think we said in the release that wholesale has been double-digit positive growth for the last 17 quarters so we would not see any reason why that should change. As far as quantifying how high the double-digits would be, I really wouldn’t want to guess at that.

I’m showing no further questions in queue at this time.

Thank you so much for everyone and I look forward to seeing you in our stores.