Williams-Sonoma Q1 Net Climbs 17 Percent
SAN FRANCISCO-Strong performances from all of its brands propelled Williams-Sonoma's first quarter to an increase of 17 percent in net income, to $46.2 million.
As Laura Alber, the company's president and CEO, explained to industry analysts during a conference call yesterday, the contributions from all of the brands boosted total net revenues to a record $974.3 million, up 9.7 percent from last year's first quarter. West Elm posted the strongest gain in comparable brand growth, 18.8 percent, followed by PBteen at 12 percent, Pottery Barn with 9.7 percent, Pottery Barn Kids with 8.1 percent and Williams-Sonoma at 6 percent. The quarter ended on May 4.
"Innovative high-quality products, personalized service, relevant marketing and strong execution across all brands drove these better-than-expected results," Alber said. "With 50 percent of our revenue in the direct channel this quarter, we believe our multibrand, multichannel platform is driving consistent market-share gains and providing us with a competitive advantage."
Direct-to-customer net revenues were up 17.2 percent in the quarter. Retail net revenues rose 3.1 percent.
Gross margin was up 20 basis points to 37.8 percent. Selling, general and administrative expenses rose 8.8 percent in dollars but dropped 30 basis points as a percentage of sales, to 30.2 percent.
Alber said Williams-Sonoma's first-quarter results reflected the company's "multiple engines of growth supported by distinctive products presented across our portfolio of brands, a superior multichannel platform with analytic marketing to capture the synergies and the advantages of each channel and a sophisticated supply-chain engineer to address the complexity of our merchandise category. We are confident in our ability to meet our fiscal 2014 and longer-term growth target."