Glen T. Senk – Chief Executive Officer, Director Richard A. Hayne – Chairman of the Board & President John E. Kyees – Chief Financial Officer Tedford G. Marlow – President Urban Brand Worldwide

Liz Dunne – Thomas Weisel Partners, LLC. Sharon Zackfia – William Blair & Co. Janet Kloppenburg – JJK Research Randal Konik – Jefferies Neely Tamminga – Piper Jaffray Barbara Wyckoff – Buckingham Research Adrienne Tennant – Friedman, Billings, Ramsey Analyst Michelle Tan – Goldman Sachs Kimberly Greenberg – Citigroup Richard Jaffe – Stifel Nicolaus Robin Murchison – SunTrust Robinson Humphrey Michelle Clark – Morgan Stanley Brian Tunick – J.P. Morgan Christine Chen – Needham & Company, LLC Marni Shapiro – Shapiro Partners Dana Telsey – Telsey Advisory Group Samantha Panella – Raymond James & Associates Betty Chen – Wedbush Morgan Securities Margaret Whitield – Sterne, Agee & Leach Howard Tubin – RBC Capital Markets Roxanne Meyers – UBS Analyst for Laura Champine – Cowen & Company Holly Guthrie – Boenning & Scattergood Crystal Kallik – D. A. Davidson & Company

Welcome to Urban Outfitters, Inc., third quarter fiscal 2009 earnings call. At this time all participants are in a listen only mode. Later we will conduct a question and answer session and instructions will follow at that time. (Operator Instructions) This conference call is being recorded. 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. I would now like to introduce you to our host for today’s conference, Mr. Glen Senk, CEO. Sir, you may begin. Glen T. Senk: It is my pleasure to welcome you to the URBN quarterly conference call. Joining me today is Dick Hayne our Chairman, John Kyees our Chief Financial Officer and our senior team including our brand and shared service leads. Earlier this morning the company issued a press release outlining the financial and operating results for the three and nine month periods ending on October 31, 2008. I will begin today’s call by reading prepared commentary regarding our performance. Then the group and I will be pleased to answer any questions you may have. As usual the text of today’s conference call can be found on our corporate website at www.urbanoutfittersinc.com. Put simply the organization produced extraordinary results during the third quarter versus the comparable quarter last year. Total company sales increased 26% to $478 million, our largest quarter in history. Total company comparable store sales grew by 10%. Anthropologie, Free People and Urban Outfitters achieved comp increases of 2%, 4% and 17% respectively. Direct-to-consumer sales jumped to an impressive 41% despite a strategic decrease of 9% in catalog circulation. Free People’s wholesale revenue increased by 21%, the 20th consecutive quarter of double digit sales growth. The company delivered improvements in every component of gross profit margin, initial markup, markdown rate and occupancy rate resulting in a 135 basis point gross margin gain to 40.9%. The organization managed the business with exceptional discipline resulting in SG&A leverage of 139 basis points and a comp inventory increase of just 2% at quarter’s end. Income from operations grew by 47% to a record $90 million or a operating margin of 18.9%. Finally, earnings increased by 31% to a record $59 million resulting in earnings per diluted share of $0.35. I will now go into more detail on each of our key business metrics for the quarter starting with sales. New and non-comparable store sales for the quarter contributed $43 million accounting for 44% of the total revenue growth. The company opened 17 new stores, three Anthropologie stores, six Free People stores and eight Urban Outfitter stores bringing the total new stores open for the first nine months of the year to 41. The company produced positive comps every month in the quarter. On a month-to-month basis, August was the strongest month followed by October then September. All regions experienced healthy gains with the Northeast region leading the way across the brands. All location types were also composited for the company with metropolitan stores leading followed closely by mall locations. Our comp performance was driven largely by an 8% increase in the number of transactions with gains of 5% and 9% in Anthropologie and Urban Outfitters respectively and a decrease of 1% at Free People. The company’s average unit selling price increased 6% in total down 3% at Anthropologie and up 2% and 14% at Free People and Urban Outfitters respectively. Units per transactions decreased by 4% in total, flat at Anthropologie up, 3% at Free People and down 6% at Urban Outfitters. At Anthropologie the change in average unit selling price was primarily driven by an increase in accessories penetration. At Urban Outfitters the metrics were driven by a higher average ticket in the women’s apparel division and an overall lower penetration of markdown sales. Throughout the quarter the accessory category set the pace with a very significant comp performance and all other merchandise categories were positive or flat. Similar to last quarter there were numerous meaningful trends in the woman’s apparel business and I believe we have positioned out inventory appropriately for the remainder of the year. Now let me turn your attention to our direct-to-consumer business. Direct sales for the quarter increased 41% to approximately $66 million to spite a circulation decrease of 9%. The penetration of direct-to-consumer sales to total company sales increased by 150 basis points to 13.8% from 12.3% during the comparable quarter last year. These results were driven by website visits which were up 43% to 17 million visits, a gain of more than 5 million visits over the prior year’s quarter. The strength in our direct-to-consumer business ran across all brands but especially at Free People where with just 11 comp stores the direct-to-consumer business revenue exceeded the comp store revenue. These outstanding results illustrate the success we have had with a myriad commerce initiatives including our new web platform, redesigned websites at all three brands, international shipping, product reviews, video, blogs and a variety of innovative functionality and marketing techniques. Finally, the company quarterly wholesale sales increased by 26% versus the same period last year, to approximately $34 million. Free People wholesale sales increased by 21%, our 20th consecutive quarter of double digit sales growth. The increase was driven by a 10% increase in units and a 10% increase in average unit price with all channels of distribution growing relatively equally. More importantly our retail partners were generally pleased with the Free People performance in the third quarter and I believe we continue to rank in the top productivity tier at most if not all of our accounts. Bookings for spring deliveries are slightly ahead of last year and will remain optimistic regarding the potential of our new sub-brands, We the Free and Intimately Free the People. Leifsdottir, Anthropologies new wholesale line generated wholesale revenue of $1.4 million in the quarter. The reaction at our retail partners has far exceeded expectations so we continue to be encouraged by the brands prospects. I would like to now turn your attention over to gross margin, operating expense and income. Total company gross margin advanced 135 basis points for the quarter to 40.9%. Congratulations are due to Urban Outfitters brand for leading the advance with the most significant improvement. Total company comparable inventory was up 2% at quarter’s end and we believe our inventories are clean and appropriately positioned for the final quarter of the fiscal year. The company reduced its operating expense by 139 basis points to 22%, principally due to the control and leverage of direct store expenses and other fixed corporate expenses which more than offset results based bonus compensation and investments in our new startup businesses Terrain and Leifsdottir. Income from operations increased 47% versus the same quarter last year to $90 million generating a 18.9% operating margin. Net income advanced by 31% to $59 million with earnings per diluted share growing to $0.35 versus $0.27 for the same quarter last year. The company’s third quarter tax rate was 35.4% versus 28.5% in the comparable period last year, but it is important to remember last year’s unusually low annual effective tax rate was primarily impacted by the receipt of one time federal tax incentives for work performed on the development of our new home offices. During the quarter the company wrote off a single issue of approximately $2.9 million of option rate preferred shares associated with failure of Freddie Mac. Our portfolio strategy has always been to preserve capital and this has been the only permanently impaired security in our portfolio. I am extremely proud of the company’s third quarter results. The Anthropologie and Free People teams successfully lapped difficult comparisons and Ted and the Urban Outfitters teams continue to make exceptional progress in the brand’s turnaround. All three brands delivered a compelling customer experience in the quarter including a highly differentiated and well positioned product assortment. I have intentionally gone this far in my prepared remarks without commenting on the economy. Those of you who have covered us or invested with us over the years have seen us focus primarily on what we can control and that is how we will continue to manage our business. Here is what we know about the current environment. The economy is contracting. Unemployment is at a 14 year high. The consumer is fearful and many retailers are struggling. I visited a variety of malls and centers over the last week, many retailers are highly promotional. In fact, I don’t think I have ever seen quite so many percent off placards or friends and family events before and we expect it is going to become even more promotional before the end of the holiday which will certainly impact our business. Not surprisingly, the national press is hyping the story which breeds even more fear. Just yesterday for example, the New York Times featured a front page story whose headline read, and I quote, “Buying binge slams to halt prices of confidence for US consumers.” The Urban family will continue to compete the way we always do by remaining wholly customer focused and working hard to wow the customer on a daily basis by continuing to take managed risks so that we excite the customer with newness and innovation and by making our stores, catalogs and websites unexpected and fun so that they create a powerful emotional connection and provide a respite from the moroseness of the world. Let’s remember, women shop to feel good, to feel beautiful, to feel comfortable and to feel connected. Rest assured we are paying close attention to the daily tells in our business while we plan on maintaining all customer facing expenditures we will rigorously manage our inventory and variable expenses to our business trend. The sales trend thus far in November has slowed from a brisk October pace and while we cannot forecast the fourth quarter, we certainly expect the months ahead to be challenging and we are prepared to respond. With regard to longer term expenditures, our strategy is to continue to appropriately invest in our growth initiatives which include driving comp store activity, opening new stores, developing new concepts including terrain and continuing with the related shared service programs that support these initiatives. We have always managed cash conservatively, but given the existing environment we intend to employ even more demanding analysis and requirements. The current turmoil, economic outlook and consumer unrest is uncomfortable, but challenging times present abundant opportunities. We are convinced that as we navigate through this period, we will emerge stronger, more disciplined and with greater market share in each of our brands. We know that the only thing that is eternal is change and that those who thrive, who continue to grow and prosper are those who are most adaptive. Our team and our business partners are motivated, positive and determined. Our goal is to run an outstanding business in good times and bad and our 12,000 plus employees share this vision and commitment. The company’s overarching goal has been constant and simple. To grow revenue at least 20%, to grow profit at a faster rate than sales and to reach a minimum of 20% in operating margin. We have achieved our growth goals consistently over time and we remain confident in our prospects going forward. As always, the leadership team and I look forward to continuing to inspire our customers, reward our shareholders and employees alike. I will now open the call to questions and as is our custom, I ask each of you to limit yourselves to one question. I apologize in advance if you ask more than one question we will respectively respond only to your first query. Thank you.

(Operator Instructions) Our first question comes from Liz Dunne – Thomas Weisel Partners, LLC. Liz Dunne – Thomas Weisel Partners, LLC.: I guess the first question should be, you mentioned that sales trends have slowed thus far in November, can you talk about the magnitude of this slow down and whether or not it occurred across all divisions? Glen T. Senk: : Liz, you know I would like to just stick with my prepared comments and say that sales have slowed down. If you look at last week between the election and the shift in Halloween it was a very complicated week to interpret and I think we just don’t have enough information in the first 12 days of the month to give any kind of prognosis.

Our next question comes from Sharon Zackfia – William Blair & Co. Sharon Zackfia – William Blair & Co.: I was wondering if you could give us some perspective on what you think continues to drive the strength in the core Urban Outfitters concept even as we hear all this concern from the macro environment and whether you are seeing any signs of concern for that concept as we enter the holidays? Glen T. Senk: I’ll ask Ted to respond to that. Tedford G. Marlow: For the quarter obviously the back to school period is a very important period for us at Urban. It essentially is no par with our holiday business in regard to strength. That’s when our customer is out and shopping. I feel that we had great product offer for the back to school period this year that helped us come out of second quarter very strong and kick off third quarter very strong. Our core businesses in women’s apparel and accessories as well as men’s apparel and accessories produced very strong comps throughout the quarter. As we got in to some dicier times with news on the economy in the month of October the business did hold up. As to whether you want to read in to that, that perhaps our customer being 18 to late 20s may be a little out of the loop in regards to what’s going on in the investment community, that’s your call. We did produce strong comps in the month of October. But, overall for the quarter the business was just really driven by strength in a lot of categories in our core businesses men’s and women’s. Glen T. Senk: I would also just build on what Ted said and certainly the product looked great. But I think the stores organization did an exceptional job in the third quarter in visual presentation and store operations.

Your next question comes from Janet Kloppenburg – JJK Research. Janet Kloppenburg – JJK Research: Glen and Ted, it looks like this calculation can be distorted but it looks like the new store productivity may have slowed a bit in the third quarter, perhaps it did, perhaps it didn’t. If it did can you please address some issues that may have affected that. Glen T. Senk: Janet, that’s not true. We’re very pleased with the stores that we’ve opened this year, we’re pleased with the stores we’ve opened last year. They’re performing amazingly consistently over probably the last 10 years. Janet Kloppenburg – JJK Research: So you’ve seen no slowdown from in the period? Glen T. Senk: No. Janet Kloppenburg – JJK Research: It’s hard for us to get a pure number. Glen T. Senk: It is hard because I think several people who’ve issued notes don’t tend to look at when the stores open within a quarter. Janet Kloppenburg – JJK Research: That’s why it’s hard for us to know if it’s true or not.

Our next question comes from Randal Konik – Jefferies. Randal Konik – Jefferies: Question for John on real estate, John can you just talk about all the REIT turmoil we’re seeing out there are you starting to look at renegotiating any leases or getting better lease terms? Then, can you just remind us again what the comp rate you need to get leverage now in occupancy and if you foresee that coming down a bit as we head in to 2009? John E. Kyees: Randy, I’ll address the second question offline. The first question yes, we are going back to renegotiate leases. We think that we present an usual situation for landlords today. If you’re a landlord you want really three things: you want a business that draws traffic; you want a business that pays you excess rent occasionally because you beat break points on your productivity; and you want a business with a great balance sheet. I think we fill the bill on all these categories so I believe that of all the retailers out there we probably have the better opportunity of really extracting some rent reductions and we are in the process of renegotiating.

Our next question comes from Neely Tamminga – Piper Jaffray. Neely Tamminga – Piper Jaffray: Just a question here on the wholesale brand and those initiatives, clearly the retail outlets that sell a lot of your wholesale businesses are falling apart from a comp sell through perspective in what they’re reporting. Could you just kind of size up, I mean we see what your sell in numbers are but are you seeing any sort of difference on the sell through rates of your brands that participate in some of these retailers or are you the anomaly there? Just kind of help us figure that out? Glen T. Senk: As I said in my prepared comments I think the retailers that we sell to were very pleased with our performance in the third quarter. I don’t have sell through information on the 1,200 or so specialty accounts that we shipped in the third quarter. I certainly do have sell through information in the major accounts and I think we had very good business in all of the people that we sold. Quite frankly, outstanding business in some of the people that we sold so they’re certainly happy with us.

Our next question comes from Barbara Wyckoff – Buckingham Research. Barbara Wyckoff – Buckingham Research: Can you talk about the international expansion, the timing of Anthropologie expansion? I’m’ happy to hear about the Hamburg store from Urban. What else is in the pipeline there? Then plans to expand the web presence internationally? Then, how do you handle the fulfillment for that international web business? Glen T. Senk: Barbara, I think most of you are aware that hired a head of Anthropologie Europe named James Bidwell who actually starts at the beginning of the New Year. We have not announced any leases but I suspect that we will do so within the next quarter or so and as I said in the last call, I think that we would think about opening a store in late 2009, early 2010, the first Anthropologie. The Europe business for Urban is excellent. We’re very, very pleased with productivity both from a top line and bottom line. With regard to the ecommerce business we’re also pleased. As you know, Ted’s group started a UK based ecommerce business roughly two years ago and it continues to exceed expectations. The Anthro team began shipping internationally at the tail end of last year and that’s exceeded expectations. Right now the fulfillment in our European business is done through a third party service provider and that’s something we’re in the process of evaluating bringing in house. It’s not a question of if, it’s a question of when. I think long term we’re very committed to Europe and we envision having a shared service infrastructure in Europe that mimics what we’ve done in America.

Our next question comes from Adrienne Tennant – Friedman, Billings, Ramsey. Adrienne Tennant – Friedman, Billings, Ramsey: My question is on you reiterated your top line growth of 20% and then your bottom line greater than 20%. I guess that implies that the square footage growth remained in this high teen range with low single digit positive comp implications. Tim, my question really is on cap ex, I mean a lot of people are really slowing their square footage growth, what would you have to see happening in order for you guys to reconsider your cap ex plans? Glen T. Senk: As I said in my prepared comments, we intend at this point to continue to make investments as usual. Now, as usual has changed a bit because the environment has changed a bit. I think we’ll have more stringent ROFs and ROI requirements going forward than we might have had in the last year. As John I think very eloquently pointed out, we view ourselves as a pretty ideal tenant and we are absolutely going back to the landlord community and those landlords, I mean our goal is to continue with our expansion assuming that the landlords meet our requirements we will do so, if they don’t we may changed path but, based on the conversations we’ve had with them at this point, we’ve had a myriad of conversations with them over the past several months, I expect that they’ll meet us where we’d like to be met. That’s basically it. I think that none of us, or at least no one sitting in this room or no one I’ve spoken to called what is going to happen accurately six months ago. I don’t think anyone knows what is going to happen six months from now. As I said in the prepared comments, we are keeping our ear to the ground on a day-to-day basis but we all have tremendous face in the Urban family of brands and we will quite frankly do nothing to jeopardize our long term growth prospects. Adrienne Tennant – Friedman, Billings, Ramsey: Are you saying that your ROI hurdle is higher than it was historically? Glen T. Senk: Let me phrase that a little bit differently. What I would say is that we think that we can achieve rent reductions and cap ex reductions. We think that given the current economic environment there are opportunities from one end of our business to the other starting with rent, continuing with capital expenditures, product costs, even payroll costs. There is not a stone that we are not uncovering right now in our business and we’re actually very excited about that.

Our next question comes from Analyst for Michelle Tan – Goldman Sachs. Analyst for Michelle Tan – Goldman Sachs: I was hoping you could give a little more color no how you were able to control SG&A growth so effectively this quarter? And also, if you could talk about the sustainability of that for the next couple of quarters? Glen T. Senk: I have to give credit to the 12,000 plus employees who run this organization with me. I mean, it’s not about any single person it’s really about everybody chipping in and participating in division of what we do. I’ve been with the company 15 years, for the 15 years I’ve been here we have had an incredible fiscal discipline and it really is shared throughout the entire organization so I’ve got to give credit to the company. Does that answer your question?

Our next question comes from Kimberly Greenberg – Citigroup. Kimberly Greenberg – Citigroup: I just had a question for John on the gross margin. Could you give us some color on the basis points attributable to the various factors that helped gross margin improve? And, just within the merchandise margin could you comment on your inventory obsolesces reserve and how that compares to last year? John E. Kyees: Well inventory obsolesces reserve, I’ll deal with that one first, that’s a consistent accounting practice based on age and obsolesce of inventory so nothing really changed in this quarter against our historic patterns. In terms of the break down between mark up, mark downs and occupancy, I think it’s far to say that we got contribution from each area but we really don’t want to provide specific basis point improvement. Kimberly Greenberg – Citigroup: John did you list those in order of magnitude? In other words, can we assume that they were like in ingredient order? IMU up more, markdowns contributed second and occupancy leverage contributed third? John E. Kyees: The biggest piece was occupancy leverage followed by markdowns and then mark up.

Our next question comes from Richard Jaffe – Stifel Nicolaus. Richard Jaffe – Stifel Nicolaus: Just going back to the occupancy and new store plan, are you prepared to talk about new stores by category for ’09, how you’ll get to the high teens square foot growth? And if not, could you comment on some of your sourcing initiatives and the opportunities to improve gross margin? Glen T. Senk: In terms of the store breakdown, the high teen number was the number that Adrienne threw out, it really wasn’t our number. We’ve been saying it’s going to be mid teen square footage growth and that’s a combination of 15 to 20 Urban and Anthro stores and probably 10 to 15 Free People stores. Richard Jaffe – Stifel Nicolaus: Would that include some of the European initiative, the store count? Glen T. Senk: It would, yes. Richard Jaffe – Stifel Nicolaus: Can you detail out how many European stores you’ll build in ’09 or is that too early? Glen T. Senk: We don’t know yet. We’re still looking at deals for ’09. It will be more than one and less than 10 but I couldn’t tell you how many exactly.

Our next question comes from Robin Murchison – SunTrust Robinson Humphrey. Robin Murchison – SunTrust Robinson Humphrey: Just a question if you can update us on your efforts in your new hires, the Asian sourcing and the Asian effort? Also, embedded in that if you’ll comment on what you’re seeing cost wise? Glen T. Senk: Robin, I don’t understand the question. Are you saying hires with regard to Asian efforts? Robin Murchison – SunTrust Robinson Humphrey: Just where that effort is? We know you’ve got somebody in there but what you’re seeing over there and what you’re seeing in terms of costs? Glen T. Senk: You’re talking about our speed to market and our concept to market effort? Robin Murchison – SunTrust Robinson Humphrey: Correct. Glen T. Senk: As we said on the last call, we are still developing our view as to what our office in the Far East will look like. We had one view earlier in the year, I spent several weeks there, we’ve had a lot of conversations since that time and we’re developing a different view. We have a terrific staff there now that worked for us in an aging capacity and I expect we’ll do some hiring there but I don’t think anything that would have any impact on the organization other than possibly some tax advantages for us. With regard to costs, it goes back to what I said before, I’m hearing stories of buyers from other organizations going overseas and cancelling massive amounts of merchandise and I think this presents and opportunity for us. We’ve been going to the parties consistently for decades. With a couple of speed bumps [inaudible] an order it sticks and the vendors appreciate us and they are as excited about helping us navigate through this economy as we are excited ourselves. So, to answer your questions, we do expect to have cost reductions.

Our next question comes from Michelle Clark – Morgan Stanley. Michelle Clark – Morgan Stanley: The question I have is if you look back over the past several quarters, obviously you guys have had very strong gross a margin improvement, I just wanted to get your thoughts on further room for gross margin opportunity as we look ahead in to the fourth quarter and in to next fiscal year? Glen T. Senk: Michelle, I certainly don’t feel comfortable with timing on the fourth quarter but I certainly feel comfortable giving you an opinion about the future. I believe we still have significant opportunity in margin. I believe we have significant opportunity on initial margin, I believe we have significant opportunity on maintain margin and I believe we have significant opportunity in occupancy. That is something we’re very, very focused on as a company. We have a myriad of initiatives that we began to undertake a year and a half ago and we’ll continue to undertake and I don’t want to put a number to it but it’s significant.

Our next question comes from Brian Tunick – J.P. Morgan. Brian Tunick – J.P. Morgan: We were wondering, as we try to model the Q4, maybe if you could give us inventory by brand and maybe where you plan to end the quarter by brand? Glen T. Senk: Brian, we also base our inventory plans on our current business. As I said in my prepared remarks, the group did an extraordinary job managing the inventory. We exited the quarter with I think probably the best FIFO conditions in my memory. We’re clean, we’re lean and we’re buying to our business trend. I don’t know what the business is going to look like three, four, five months from now but I can tell you we look at the tells on a daily basis and we will adjust the inventories up or down as we historically have.

Our next question comes from Christine Chen – Needham & Company, LLC. Christine Chen – Needham & Company, LLC: I wanted to ask I guess a little bit more about inventory, you always manage your inventory to weeks of supply. Can you share with us what they’re running at Urban and what they’re running at Anthro and if they are where you’d like them to be. Glen T. Senk: You have to look at averages because we’re obviously building our inventory for the fourth quarter right now but on average our target for both of the brands in apparel and accessory area is in the 10 range. It will dip down nine and it will dip up to 11 or 12 based on where we are in the business cycle. Free People obviously we turn considerably faster than that because the stores are much smaller. Back to the MMU opportunity, I believe strongly that we have an opportunity to continue to improve our turn or reduce our weeks of supplies over the next several years as well. You know that we just implemented the new planning system last quarter. We’re continually refining the way we think about allocations and there are so many positive benefits to reducing weeks of supply. The stores look better, they’re easier to manage, you reduce markdowns to better customer experience so that is something that we’re very, very focused on as a company.

Our next question comes from Marni Shapiro – Shapiro Partners. Marni Shapiro – Shapiro Partners: I was curious at Anthro, I walk through quite frequently and I’ve noticed you’ve really made an effort to mix up the product between apparel and non-apparel and to me it feels like when I walk in the stores today where I might have seen higher price points at the front because of the mix of product at the front of the store and a nice assortment of knits and sweaters $200 and under, it feels a little bit less off putting to somebody in this environment. Was that intentional or just a happy coincidence? Glen T. Senk: I think that probably a little bit of both Marni. I think that we’re always interested in presenting an eclectic assortment. That was Dick’s vision 30 some odd years ago was to never have a narrow span of price points to have a broad band of price points to surprise and delight with a $4 item and surprise and maybe not delight with a $2,000 or $3,000 item. Certainly, I read Women’s Wear Daily yesterday were Allen Questrom at the WWD Summit talked about value. But, I think he articulated it very well because value doesn’t mean inexpensive price, value means that the customer gets a lot for what she’s paying for and I think that in all of our businesses that’s what most important so we’re certainly every value focused as opposed to price focused. I think where the average unit retailers were in the third quarter were pretty comfortable for us.

Our next question comes from Dana Telsey – Telsey Advisory Group. Dana Telsey – Telsey Advisory Group: A quick question, when I think of the brand initiatives of the company whether it’s owned branded Urban or whether it’s Leifsdottir Shoes or CRM at Anthro and the We The Free and the Intimates at Free People, how do you look at those initiatives, how far along you are on each one and the IMU opportunities for each of them and the businesses? Glen T. Senk: That’s a great question. It could be a half hour answer. I think very quickly I think Ted and Ted’s leadership team have just done an extraordinary job at Urban Outfitters. I think you if you tried to envision how could Urban could have looked a year ago, in my wildest dreams they wouldn’t have made the kind of progress that they have made. The stores look fantastic, they feel fantastic. If you go to the blogs, the customer reaction to what they are doing is sensational so hats off and as I said earlier it’s certainly the product but it’s also the planning effort from [Kelly Walker] it’s the visual merchandising efforts from [Sue Otto], it’s the store operation efforts from John Hauser, it’s the whole team. They’re doing a brilliant, brilliant job. Free People, I called Meg after visiting the We The Free store in Brooklyn. I was there I think at 7:30 one morning and I said, “Meg I have Goosebumps I’m so excited about what you’ve done.” I think it’s one of the most exciting new concepts that I have ever seen. Now, like all the things that we do they take time. There are some days that we have in the two new We The Free stores that are terrific, there are some days that are disappointing. This is to be expected, this is what it is like giving birth to a new concept but conceptually I think the concept is wonderful. Intimately Free, the product looks fantastic, the customers love it, the stores love it. If I go to Anthropologie, Leifsdottir, I think if you thank the people like Marni and other people like Marni, I think if you go to Bloomingdales or if you go to Nordstrom and you speak to the staff there and you speak to the staff there you’ll hear a tremendous amount of excitement about the product. I mean literally for example, on 59th Street Leifsdottir went from a temporary shop to a hard shop within weeks because the company was so pleased with the performance there. CRM, I think at last count we had close to 700,000 names and we’re beginning to utilize those names and we’re well on our plan with the efforts there. I forget what the last initiative was at Anthropologie but one of the things that Dick has taught me and that all of the people sitting around this conference room table today believe so strongly in is maintaining a culture of entrepreneurialship and the way that we do that is we look at each of these initiatives as individual businesses and they all have owners. We can deal with the complexity of the economic situation the way we’ve been able to because each of these other initiatives have owners who have their own set of responsibilities and the beauty of this business is that as we grow larger we continue to feel as entrepreneurial as we did when I joined the company 15 years ago and it’s because of the way we structured these things. So, to answer your question, I feel very, very good about the progress we’ve made on those myriad of initiatives.

Our next question comes from Samantha Panella – Raymond James & Associates. Samantha Panella – Raymond James & Associates: Looking at the Urban Outfitters division and the margin opportunities, obviously you’ve accomplished so much but I guess just piggybacking off of Dana’s question, where you’re at in terms of the mix of owned brands versus third party brands and what the target is? Tedford G. Marlow: Sure, I’ll take it. Just as a reference point let me talk to the third quarter and I’ll speak really to where the largest piece of the business is and that’s women’s apparel. If I am looking at the men’s and women’s business for the quarter, about 25% of the business was done in product other than owned brand and part of that, about 10% of that is collaboration and about 15% of that is pure brand that we buy in the market. Of the remaining 75% of the mix in the quarter we were right at 40% of that mix and again, this is for men’s and women’s apparel. About 40% of that mix was developed by internal design, it’s our intention to continue to push that mark higher. There’s no reason that we shouldn’t have over half of the mix of product carrying our own brands being developed by internal design team as we turn the corner in to next year. So, we made very good headway on that initiative over the past year. The design staff to support it on the women’s side rep around 25 people and we have I guess at this point in the men’s group about eight people and the work that we’re getting out of the crew in both areas we’re seeing very nice improvement in the metrics in regards to weeks of supply performance as well as what we’re seeing on the IMU line.

Our next question comes from Betty Chen – Wedbush Morgan Securities. Betty Chen – Wedbush Morgan Securities: John or Glen, I was wondering if you can talk a little bit more about the accessories category? I think you mentioned earlier that it performed quite well during the third quarter. Could you remind us what is the sales mix of the accessories for each concept? And also, are there plans to perhaps increase the penetration of that longer term especially for the holiday season because it seems like a great gifting idea? Then related to that how is the shoes shop-in-shop working in the Anthropologie stores? Glen T. Senk: Betty, I’ll try and take that one on. The accessory business led the way in all three of our brands so we had across the board strength in accessories. In terms of penetration we never give specific numbers but I would say that it ranges depending upon the brand from roughly 10% to 16%. In terms of our plans to grow the penetration, that’s really up to the customers. The great thing I think about our concepts is we’re customer killers not category killers so we really let the customer decide what she wants and if she continues to want accessories the way she’s wanting them right now the penetration will continue to increase. If it shifts to something else we’ll shift the inventory. Having said that, we’re definitely believe – we believe we’re in an accessory cycle and we believe we’ll continue to be in an accessory cycle. With regard to shoes in Anthropologie, we started with 23 doors, we rolled it out to roughly 45 doors and the shoes are doing very, very well so we’re very pleased with the state of the business there. Betty Chen – Wedbush Morgan Securities: Glen, just to follow up on that if I could , are you seeing any difference in reaction on different price points, even in the accessory category? Glen T. Senk: It goes back to what I said earlier Betty, I think that value is important. I’m not sure that I personally could get excited about selling $1,200 handbags right now but that’s not our business. Our average price in accessories, I don’t have it, we can talk off line but it’s probably closer Ted, at Urban it’s $25 maybe? Tedford G. Marlow: In accessories. If you put shoes in there it will be up a little over but if shoes are out a little less. Glen T. Senk: So without shoes a little less than $25. At Urban and Anthro it’s probably roughly about $40. This is not a hugely expensive product. This is product that people can go in and it’s like candy or lipstick, these are the kinds of things that often do well in tough economies because people can go in and for not a lot of money buy something and kind of lift their spirits. So, I expect we’ll continue to do well with those categories.

Our next question comes from Margaret Whitield – Sterne, Agee & Leach. Margaret Whitield – Sterne, Agee & Leach: In the third quarter you had a decline in circulation yet the direct business was up. I wondered if you could comment on your forward circulation plans for your three units? Glen T. Senk: We have not finalized the circulation plans for next year Margaret. But, I will say that the brands have done a spectacular job marketing the websites and as I’ve said on numerous calls before I think there’s a paradigm shift and this is a major shift in the way people are buying particularly for Urban Outfitters and Anthropologie where we have a very developed brick and mortar business. The customer shops between the catalog, brick and mortar and the web absolutely seamlessly. In fact, we’ve had a lot of internal discussion about combining our direct sales and our retail comp sales going forward. We’re thinking now about starting to report two ways because really the two businesses have become interchangeable. If you look at the third quarter for example, our comp increase would have gone up by a whole four points as a company. Instead of being 10 comp we would have been 14 comp and of course the biggest increase would be at Free People where if you combine the direct business and the comp base we actually would have been 28 comps. We’re able to do this because of the way we’re marketing the website and as I said we have a myriad of initiatives here. All of the brands have new sites, we launched the new web platform about a year and a half ago. The blog activity is tremendous. The viral marketing is tremendous. As I said in my prepared comments, the penetration of direct-to-consumer business in total is up roughly 150 bips and we don’t know how high that is but we believe it can be significantly higher and as John has said we’re more profitable in our direct-to-consumer business than we are in our brick and mortar business so we’re very excited about that. Margaret Whitield – Sterne, Agee & Leach: Can you comment on the difference in profitability web versus brick and mortar? Glen T. Senk: No.

Our next questions comes from Howard Tubin – RBC Capital Markets. Howard Tubin – RBC Capital Markets: Can you just tell us for any of your brands do you have anything meaningfully different planned for the upcoming holiday season in terms of marketing or in store events maybe relative to last year? Glen T. Senk: No. I have a saying that there’s nothing more boring than last year’s best seller and that goes for marketing efforts too so we always try to have newness in everything we do but I would say in terms of the cadence and the general direction of what we’re doing it would be pretty consistent with the last several years.

Our next question comes from Roxanne Meyers – UBS. Roxanne Meyers – UBS: My question has to do with the wholesale business, it seems like there’s been articles in the Times and other places about how after the holiday season we could see some small mom and pop boutique shops going under just given the sales trends. I guess knowing that about half of your business is in the specialty store and boutique distribution, how comfortable you feel about who you’re partnering up with and whether you’ve thought about contingency plans in case some of those partners don’t make it. Glen T. Senk: That’s a great question. We certainly are paying very close attention to our receivables and we started doing that many, many months ago and we have a terrific team who run that group. Listen, we love our specialty accounts, we’ve been in business with many of them for decades and we will do everything we can to work with them to get through this tough patch. But, we’re also going to continue to look at the business realistically. I think the good thing is when you have 1,200 active specialty stores and the variety of the kinds of larger partners we have, no one person is that meaningful to the total where if some of these smaller people regrettably don’t make it, I don’t think it will have any kind of meaningful impact on our business.

Our next question comes from Analyst for Laura Champine – Cowen & Company. Analyst for Laura Champine – Cowen & Company: Can you talk a little bit more about the intimates business at Anthropologie and how that’s progressed? Glen T. Senk: We’re very, very pleased with our intimates business. It’s not quite done as well as the accessories business but it’s done very, very well all year long and we’re just pleased with it.

Our next question comes from Holly Guthrie – Boenning & Scattergood. Holly Guthrie – Boenning & Scattergood: Just a follow up question on the direct business, thanks for all the information and the interesting thoughts about the paradigm shift, Glen I was wondering if you could talk about where you think the direct business might get to as a percent of your total sales? And, over what time period? I guess just looking at the competition that’s been out there with the strong brands, where you think that could get to? Glen T. Senk: Holly again, we’re going to let the customer decide. But, we wouldn’t be surprised if it ended up long term in the 20% to 30% range in terms of total penetration. I mean it’s so exciting to be a part of this and when you look at the changes, the speed with which things are changing are happening exponentially. The speed of information, the functionality on websites, people’s ability to deliver merchandise quickly, access to information, networking, product review, shopping with friends, getting the sites more tacked up, I mean this is all happening so quickly it’s fantastic.

Our next question comes from Crystal Kallik – D. A. Davidson & Company. Crystal Kallik – D. A. Davidson & Company: I just wanted to follow up a little bit more on the inventory levels and I know you’ve been working quite a bit on the concept to market. Could you give us some indication as far as the progress on the lead times in the supply chain? You’re more recently looking more closely at running lean inventory levels, how far out can you impact at this level? Glen T. Senk: It really depends upon the category of product, it depends upon whether or not we’ve taken a fabric position, which factory the product comes from. As I’ve said on earlier calls, Barbara [Rososk] who heads this area up but is doing it in conjunction with the lead merchant has done a fantastic job and we’ve been able to get reorders in a matter of weeks where we’ve owned the fabric. Where we haven’t owned the fabric or we’ve had to make up the yarn or move the fabric from Europe it could take as long as 10, 12, 14 or even 16 weeks but, in all cases that’s a marked improvement from where we were several years ago. In terms of our ability to react to the merchandising we react weekly. Barbara is in the Far East and as I said the vendor community is working very closely with us to stay tuned to the current trends in the business and to respond accordingly.

I’m not showing any further questions at this time. Glen T. Senk: As always everybody thank you so much for your interest and great questions and I look forward to speaking with you again in a few months.

Ladies and gentlemen thank you for your participation in today’s conference. This concludes the program. You may all disconnect. Everyone have a great day.