Williams-Sonoma profits up 12.6%

Larry Thomas -- Furniture Today, November 19, 2012

SAN FRANCISCO - Driven by its Pottery Barn, West Elm and Pottery Barn Kids brands, retailer Williams-Sonoma said profits rose 12.6% in the quarter ended Oct. 28 on an 8.9% jump in sales.
     The company said all three recorded double-digit growth in comparable brand revenue, with e-commerce revenues leading the way.
     Comparable brand revenue growth was up 8.5% across all five major Williams-Sonoma brands, but West Elm paced the growth with a 13% jump. That was followed by Pottery Barn at 11.1% and Pottery Barn Kids at 10.1%
     Total revenues in the period, the third quarter of Williams-Sonoma's fiscal year, were $944.6 million, up from $867.2 million in the same quarter last year.
     The company said revenues from its bricks-and mortar stores made up 52.7% of the total, while revenues from e-commerce and catalog sales accounted for the remaining 47.3%.
     Net income totaled $48.9 million or 49 cents per share, up from $43.4 million or 41 cents per share a year ago.
     "During the third quarter, we delivered stronger-than expected revenues, operating margin and diluted earnings per share," said Laura Alber, president and CEO. "Importantly, we drove these results while simultaneously investing in our strategic growth initiatives."
     She said the growth initiatives included the launches of West Elm Market, a West Elm brand extension, and Mark and Graham, an online brand featuring personalized gifts and accessories.
     For the nine months ended Oct. 28, total revenues were $2.64 billion, up 7.5% from the same period in 2011.
     Nine-month net income totaled $123 million or $1.21 per share. That's up 7.6% from $114.3 million or $1.07 per share in the same period last year.
     The retailer also boosted its revenue and earnings estimates for the second time this year. Revenues are now projected to be $3.995 billion to $4.035 billion for the 53-week fiscal year that ends Feb. 3. That's up from an August projection of $3.975 billion to $4.025 billion.
     Earnings per share are now projected at $2.41 to $2.48 for the year. That's up from the August forecast of $2.40 to $2.47.
     As of Oct. 28, the company had 584 stores, including 259 Williams-Sonoma, 193 Pottery Barn, 83 Pottery Barn Kids, 45 West Elm and four Rejuvenation.