Williams-Sonoma profits climb 10.4% as sales grow 7.3%

Larry Thomas -- Furniture Today, August 22, 2012

SAN FRANCISCO — Retailer Williams-Sonoma said profits rose 10.4% in the quarter ended July 29 on a 7.3% jump in sales.

The company said the increases were driven primarily by its Pottery Barn and West Elm formats, both of which recorded double-digit comparable brand revenue growth. Total revenues for the quarter were $874.3 million, up from $814.8 million in the same quarter last year.

Of that total, revenues from its brick-and-mortar retail stores accounted for about 53% of the figure, while revenues from catalog and e-commerce sales generated 47%.

Net income was $43.4 million or 43 cents per share, up from $39.3 million or 37 cents per share in the same quarter a year ago.

"During the quarter, we delivered strong performance in revenues, operating margin and earnings per share," said Laura Alber, president and CEO. "Importantly, we drove this growth in revenues and earnings while simultaneously investing in our long-term growth initiatives."

The company said its West Elm brand led the comparable-brand revenue growth race with a 15.6% jump. Pottery Barn was next at 11.7%, followed by Pottery Barn Kids at 3.8%, and PBteen at 0.8%.

The only brand with comparable-brand decrease was Williams-Sonoma, which was down 0.4%.

For the six months ended July 29, total revenues were $1.69 billion, an increase of 6.7% from $1.59 billion in the same period last year.

Six-month net income was $74.1 million or 73 cents per share. That was an increase of 4.5% from $70.9 million or 66 cents per share in the same period a year ago.

The retailer also boosted its sales and earnings projections for the current fiscal year, which will end Feb. 3. Revenues are now projected at $3.975 billion to $4.025 billion, up from a May forecast of $3.95 billion to $4.02 billion.

Earnings per share are now projected to be $2.40 to $2.47, up from the earlier forecast of $2.38 to $2.45.

The retailer ended the quarter with 579 stores. The store count includes 259 Williams-Sonoma locations, 193 Pottery Barn stores and 40 West Elm locations.