Pottery Barn same-store sales jump 23.3% in 1Q

By Champion in : News // May 24 2010

SAN FRANCISCO — Aided by a 23.3% same-store sales gain at its Pottery Barn stores, retailer Williams-Sonoma reported a first-quarter profit of $19.5 million.

The quarterly profit, which equals 18 cents per share, reversed a net loss of $18.7 million in the comparable quarter last year.

Companywide, sales shot up 17.3% to $717.6 million. That figure included a 20.3% gain in revenues from catalog and Internet sales.

“This year-over-year improvement was driven by the cumulative success we have seen from our strategic and tactical initiatives over the past 18 months,” said Chairman and CEO Howard Lester, who is retiring at the end of the month. “Our ongoing focus on our customers, their needs, and the aspects of the business we could control – combined with an improving economic backdrop – drove these better-than-expected results.”

The 23.3% same-store sales gain at Pottery Barn reversed a 22.6% same-store sales decline in last year’s first quarter.

The Pottery Barn Kids chain had a same-store sales gain of 22.9%, essentially recovering from a 25% decline in last year’s first quarter, while the flagship Williams-Sonoma chain had a same-store sales gain of 10.6%.

“Collectively, our brands fulfill the promise of furnishing every corner of our customers’ homes,” said Lester. “That, combined with our world-class service, has differentiated us and allowed us to emerge stronger in this post-recessionary environment.”

The company also boosted its sales and earnings projections for the fiscal year. Sales are now forecast to be $3.29 billion to $3.37 billion, up from a March forecast of $3.2 billion to $3.3 billion.

Earnings are now projected at $1.33 to $1.42 per share. That up from the March forecast of $1.12 to $1.22 per share.

The retailer ended the quarter with 610 stores, including 259 Williams-Sonoma, 199 Pottery Barn, and 85 Pottery Barn Kids locations.

Williams-Sonoma, Inc. is a specialty retailer of products for the home. The retail segment of the Company’s business sells its products through its five retail store concepts (Williams-Sonoma, Pottery Barn, Pottery Barn Kids, West Elm and Williams-Sonoma Home). The direct-to-customer segment of its business sells similar products through its seven direct-mail catalogs (Williams-Sonoma, Pottery Barn, Pottery Barn Kids, Pottery Barn Bed and Bath, PBteen, West Elm and Williams-Sonoma Home) and six e-commerce Websites (williams-sonoma.com, potterybarn.com, potterybarnkids.com, pbteen.com, westelm.com and wshome.com). During the fiscal year ended January 31, 2010 (fiscal 2009), retail net revenues accounted for 60.5% of the Company’s business and direct-to-customer net revenues accounted for 39.5% of its business.