Williams-Sonoma Posts Fourth Quarter Profit

March 19, 2006  by in UnCategorized   

By Home Furnishings Business in on March 2006 Retailer Williams-Sonoma Inc. said quarterly profit rose 6 percent, as higher sales of its housewares helped offset the impact of charges related to closing its chain of Hold Everything stores.

It also initiated a quarterly cash dividend of 10 cents per share, payable on May 24 to shareholders of record April 26, and authorized a stock repurchase program to buy up to an additional 2 million shares of its common stock.

Net income for the fourth quarter that ended Jan. 29 was $120.8 million, or $1.02 per share, compared with $113.7 million, or 95 cents a share, a year ago.

Excluding 7 cents per share in charges related to the closures, Williams-Sonoma, best known for its namesake cookware stores as well as the Pottery Barn home decor and furniture business, earned $1.09 per share.

Quarterly net revenue was $1.21 billion, up from $1.08 billion in the same quarter a year ago, while sales at stores open at least a year grew 5.8 percent.

Williams-Sonoma announced in January it would close the Hold Everything stores by the end of the year to focus on the more profitable Pottery Barn and West Elm home decor chains.

At that time, it said it would record accounting charges of 9 cents to 10 cents per share, with the majority in the fourth quarter and the remainder in the first two quarters of fiscal 2006, related to the closures.

On Monday, the company said it would incur a charge of 3 cents per share in the first half of fiscal 2006.

The company also said it expected fiscal 2006 earnings per share, excluding the Hold Everything-related charge, stock option expenses and rental costs during construction, of $2.15 to $2.19 on expected net revenue of between $3.897 billion and $3.968 billion.

On the same basis, the company sees earnings per share of 21 cents to 23 cents for the first quarter, 29 cents to 31 cents for the second quarter, and 38 cents to 40 cents for the third quarter.

The company said it plans to add 24 new retail stores this year.