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Williams-Sonoma profits jump 17% in first quarter
Powered by its direct-to-consumer business, retailer Williams-Sonoma said first-quarter profits jumped 17% and revenues were up nearly 10%.
The company, whose brands include Pottery Barn and West Elm, said revenues from its brick-and-mortar retail stores accounted for just 49.6% of total revenues. The remaining 50.4% came from direct-to-consumer revenues, which consist almost entirely of catalog and e-commerce sales.
“With 50% of our revenue in the direct channel this quarter, we believe our multi-brand, multi-channel platform is driving consistent market share gains and providing us with a sustainable competitive advantage,” said Laura Alber, president and CEO.
Revenues for the quarter ended May 4 totaled $974.3 million, up from $887.8 million in the same quarter last year.
The company said direct-to-consumer revenues were 17.2% above last year’s first fiscal quarter, while revenues from its traditional retail channel were up 3.1%. The retail increase was primarily driven by Pottery Barn and West Elm.
Net income totaled $46.2 million, or 48 cents per share. That compares with $39.5 million, or 40 cents per share, in last year’s first fiscal quarter.
The company said it opened seven retail stores during the quarter – four Pottery Barn Kids, two Pottery Barn units and one Williams-Sonoma store – while closing one location in each of those three formats.
Store count as of May 4 was 248 Williams-Sonoma, 195 Pottery Barn, 84 Pottery Barn Kids, 58 West Elm and 4 Rejuvenation locations.
Based on the strong quarter, the retailer increased its revenue and earnings estimates for the 2014 fiscal year.
The company now projects total revenues of $4.645 billion to $4.725 billion – up from a March projection of $4.63 billion to $4.71 billion.
Earnings per share are now projected to be $3.07 to $3.17. That’s up from the March forecast of $3.05 to $3.15.
Source: Furniture Today