Revenue Gain, Expense Controls Boost Williams-Sonoma's Bottom Line
August 23, 2011,
SAN FRANCISCO--The bottom line for Williams-Sonoma rose to the top in its fiscal second quarter with a 28 percent increase to $39.3 million.
The multichannel retailer's net revenues rose 5.1 percent to $814.8 million, with the primary driver to sales coming from direct-to-customer (DTC) revenues, which jumped 13 percent in the quarter, which ended on July 31. Laura Alber, president and CEO, noted that the DTC segment benefited from increased e-commerce revenues of 18 percent, which came from all of Williams-Sonoma's brands. Brick-and-mortar revenues slipped 0.7 percent, due to the reduction in retail leased square footage of 4.6 percent.
The company's gross margin as a whole rose 90 basis points to 37.9 percent. Selling, general and administrative expenses increased 3.9 percent in dollars but fell 40 basis points to 30 percent.
Going forward, initiatives in driving e-commerce and the company's international business will be crucial to Williams-Sonoma's growth, Alber said. "While there is clearly more uncertainty in the economy now than in Q2, we are encouraged by the early consumer response to our core and seasonal merchandise assortments," she said.