Williams-Sonoma's fourth-quarter profits rise 9.1%
Larry Thomas -- Furniture Today, March 20, 2013
SAN FRANCISCO — Driven primarily by its Pottery Barn and West Elm brands, retailer Williams-Sonoma said fourth-quarter profits rose 9.1% on a 10.9% jump in revenues.
The company said its catalog and e-commerce businesses continued to grow at a faster pace than traditional retail stores, and noted that all of its brands except the flagship Williams-Sonoma label recorded comparable brand revenue growth during the quarter.
Total revenues for the quarter ended Feb. 3 were $1.41 billion, up from $1.27 billion in the previous year's fourth quarter.
Revenues from its retail stores rose 4.9% to $772.9 million and accounted for 55% of the total. The remaining 45% came from e-commerce and catalog business, which the company calls direct-to-consumer revenues. Those revenues rose 19.3% to $633.5 million.
In the previous year's fourth quarter, retail and direct-to-consumer revenues represented 58.1% and 41.9% of the total, respectively.
In the most recent quarter, direct-to-consumer revenues were paced by Pottery Barn, West Elm, Williams-Sonoma and Pottery Barn Kids, while retail store revenue growth was led by West Elm and Pottery Barn.
Fourth-quarter profits totaled $133.7 million or $1.34 per share. That was up from $122.6 million or $1.17 per share in the comparable period the previous year.
Profit and revenue growth in the 53-week fiscal year ended Feb. 3 followed a similar pattern as the fourth quarter. Total revenues rose 8.6% from the previous 52-week fiscal year to $4.04 billion, while profits rose 8.4% to $256.7 million, or $2.54 per share.
For the most recent year, direct-to-consumer revenues were up 14.5% to $1.87 billion, while revenues from traditional retail stores were up 4.1% to $2.17 billion.
"We drove these results while simultaneously investing in our strategic growth initiatives, including global expansion," said Laura Alber, president and CEO. "Our portfolio of brands and our ability to generate new businesses provide stability as trends fluctuate between the different merchandise sectors in which we operate.
"Likewise, our multiple marketing and sales channels provide us competitive advantages in meeting our customers' changing needs as shopping patterns continue to evolve as to when, where, and in what format purchase decisions are made."
Alber said revenues should be $4.2 billion to $4.28 billion in the current fiscal year, and projected earnings per share at $2.65 to $2.75.
"We remain excited about the opportunities to more than double the size of our business over the next decade, while returning cash to our shareholders and increasing shareholder value," she said.
As of Feb. 3, the company had 581 retail stores, including 253 Williams-Sonoma, 192 Pottery Barn, 84 Pottery Barn Kids, 48 West Elm, and four Rejuvenation stores.
In addition to the earnings announcement, the company announced that its board of directors had approved a 41% hike in the quarterly cash dividend and a new $750 million stock repurchase program.
The new dividend of 31 cents per share is payable May 24 to stockholders of record on April 26.