Williams-Sonoma Q4 profit beats estimates; raises dividend

Williams-Sonoma reported a record year of revenue even as its fourth-quarter sales were lower than expected.

The home products and furnishings retailer’s net income fell to $355.0 million, or $5.28 a share, for the quarter ended Jan. 29, from $402.9 million, or $5.41 a share, in the year-ago period. Adjusted earnings per share of $5.50 beat analysts’ estimates of $5.46.

Total revenue slipped 1.9% to $2.45 billion, below estimates of $2.61 billion. Revenue at Pottery Barn, the company’s largest division in terms of sales, rose to $967 million from $921 million in the year-ago quarter.

Comparable brand revenue declined 0.6%  By brand, comp brand revenue rose 5.8% at Pottery Barn and 4% at Pottery Barn Teens and Kids. Comp revenue fell 2.5% at Williams-Sonoma and 10.7% at West Elm.

For the full fiscal year, Williams-Sonoma reported net revenue of $8.67 billion, up from $8.24 billion last year.

“We are proud that, despite the declining macro environment, we delivered another record year of revenue, with a comp of 6.5% on the topline, and record earnings of $16.54 per share,” said Laura Alber, president and CEO. “With our relentless focus on customer service and profitable growth, we continue to outperform our peers, gain market share, and distinguish ourselves as the world's largest digital-first, design-led, sustainable home retailer.”

In separate news, Williams-Sonoma raised its quarterly dividend to $0.90 a share from $0.78, payable May 26 to shareholders of record on April 21.

“We are proud of our fourteen consecutive years of increased dividend payouts,” said Jeff Howie, CFO. “Over the last five years, we have returned over $3.2 billion to shareholders through dividends and share repurchases. These actions reflect our commitment to maximizing returns for our shareholders.”

In addition, the retailer set a new stock repurchase program of $1 billion, which represents 12.7% of the company’s market capitalization. 

The company ended the year with 547 stores, operating under the banners of Pottery Barn (189 stores), Williams Sonoma, West Elm (122), Pottery Barn Kids (52) and Rejuvenation (9).