Williams-Sonoma profits jump 28.3% in fourth quarter

Pottery Barn same-store sales grow 8.9%

Larry Thomas -- Furniture Today, March 15, 2011

SAN FRANCISCO — Aided by a healthy same-store sales gain at its Pottery Barn chain, retailer Williams-Sonoma said its fourth-quarter profits jumped 28.3% from the comparable period a year earlier.

The company, which also operates the Pottery Barn Kids and West Elm retail formats, said Pottery Barn had an 8.9% same-store sales gain in the quarter ended Jan. 30. Pottery Barn Kids, meanwhile, reported a 4.6% same-store increase.

The largest top-line growth was recorded by the retailer's catalog and e-commerce channels, where revenues jumped 17.3% to $466 million.

Companywide sales totaled $1.2 billion, an increase of 9.7% from $1.09 billion in the same quarter the previous fiscal year.

The quarterly profit totaled $113.4 million or $1.05 per share. That compares with $88.4 million or 81 cents per share in last year's fourth fiscal quarter.

For the fiscal year ended Jan. 30, revenues were up 12.9% to $3.5 billion. That included a 14.3% same-store sales gain at Pottery Barn and a 13% same-store increase at Pottery Barn Kids.

The fiscal year profit totaled $200.2 million or $1.83 per share. That compares with $77.4 million or 72 cents per share in the year ended Jan. 31, 2010.

"Fiscal 2010 was a record earnings year," said Laura Alber, president and CEO. "Each of our brands is stronger today than a year ago and we made substantial progress on our longer term growth and profitability initiatives."

She added, "We are particularly pleased with the progress we made in merchandising, marketing, customer acquisition, and customer service, as it is these competitive advantages that allowed us to attract new customers to our brands and gain profitable market share all year, including Internet revenue growth of 27%."

The company ended the year with 592 retail stores, including 260 Williams-Sonoma locations, 193 Pottery Barn stores, 85 Pottery Barn Kids stores and 36 under the West Elm banner.

The company said it expects to open 15 stores across all its formats and close 26 during the current fiscal year. Twenty of the store closures will be permanent, and six are temporary closings for remodeling or relocation.

Williams-Sonoma is projecting 2011 revenues at $3.64 billion to $3.72 billion.