Williams-Sonoma kicks off fiscal year by beating Street, will close 30 net stores
Specialty home furnishings retailer Williams-Sonoma Inc. exceeded Wall Street expectations for profit and revenue in the first quarter of fiscal 2019, but still plans to shutter some stores.
Williams-Sonoma reported net revenue of $1.24 billion, a 3% increase from $1.2 billion in the first quarter of fiscal 2018. Net earnings were $62.66 billion, up 2% from $45.17 billion. Adjusted earnings per share totaled $0.81, compared to $0.54 in the year-ago period. Wall Street analysts had predicted net revenue of $1.23 billion and EPS of $0.69.
Same-store sales rose 3.5% across the company, compared to 5.5% in the prior year period. West Elm led all brands with an impressive 11.5% same-store sales growth, followed by Pottery Barn at 1.5% and Pottery Barn Kids and Teen at 1.2%. Same-store sales declined 1.6% at the Williams-Sonoma brand.
During fiscal 2019, Williams-Sonoma intends to close a net of 30 stores, for a total store count of 595 by the end of the fiscal year. The retailer is also forecasting fiscal year net revenue of $5.67-$5.84 billion, same-store sales growth of 2%-5%, and diluted EPS of $4.55-$4.75. EPS guidance has been raised by $0.05 per share. Long-term, the retailer is targeting total net revenue growth in the mid-to-high single digits.
Laura Alber, president and CEO, Williams-Sonoma, cited the company’s recent addition to the Fortune 500 as a sign of its success.
“Customer acquisition and engagement continued to grow as we delivered more compelling and differentiated experiences to our customers,” said Alber. “We also reached a significant milestone for our company as we were named, for the first time, to the Fortune 500 largest companies in the U.S. This accomplishment speaks to the hard work and dedication of all our associates, the ongoing support of our loyal customers and the power of our highly differentiated platform in driving long-term, profitable growth.”