Williams-Sonoma's global reach to expand
Furniture Today Staff -- Furniture Today, August 29, 2013
San Francisco - Home furnishings, textiles in particular, largely drove Williams-Sonoma Inc.'s second-quarter revenue growth - much of it in the double-digit range - while the company steps up its global expansion efforts, most recently into the Philippines.
"Our home furnishings brands generated a 14% increase in revenue," president and ceo Laura Alber noted during the company's quarterly conference call, adding that each of the company's home furnishings brands delivered double-digit revenue growth. Comp increases were also significant for the nameplates: 9.9% for Pottery Barn, 8.2% for Pottery Barn Kids, 16.5% for West Elm, and 16.3% for PBteen.
Upon releasing its quarterly results yesterday afternoon, the company also announced its latest international initiative - a multi-year agreement with Stores Specialists Inc. to open new stores in The Philippines. Pottery Barn and Pottery Barn Kids will be the first to debut and are slated to open in Manila in early 2014 at Bonifacio High Street, the first main street retail concept in the Philippines. The agreement also includes development rights for Williams-Sonoma, PBteen and West Elm.
Other plans include the opening of six new stores in company-owned retail locations outside the U.S. by yearend - five in Australia and one in the United Kingdom. The company's partnership in The Middle East continues to expand, reaching 25 stores in five countries by the end of the second quarter.
Net earnings for the 26 weeks were up 4.7% to $88 million and earnings per share grew 14.0% to 49 cents.
Total company quarterly net revenues grew 12.3% to $982 million, with comparable brand revenue growth of 8.4%.
Direct-to-customer sales jumped 15.3% to $478 million, primarily driven by Pottery Barn, West Elm, PBteen and Pottery Barn Kids. The online segment's generated 49% of total company revenues in the quarter, compared to 47% last year.
Retail net revenues in the second quarter were up 9.7% to $505 million, driven primarily by Pottery Barn, West Elm and the international franchise operations but partially offset by a decrease in Williams-Sonoma, where outdoor seasonal textiles program disappointed.
The three Pottery Barn brands collectively represented more than 60% of the company's overall revenue on annual basis. All key categories within these nameplates - Pottery Barn, Pottery Barn Kids and PBteen - performed strongly, and this fall Pottery Barn will roll out new and expanded bedding offerings.
West Elm "continues to be our fastest growing brand," Alber said, posting 26% revenue growth - of which a big part stems from its online business.
Year to date, total revenue rose 10.5% $1.87 billion, with $896 million coming from direct-to-consumer and $973 million in retail net revenues.
Williams-Sonoma Inc. is raising its fiscal 2013 revenue guidance to a range of $4.26 billion to $4.34 billion and its non-GAAP diluted EPS guidance to a range of $2.69 to $2.79.
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