Williams-Sonoma Inc. Earnings: After Three Quarters of Expanding, Margins Shrink, but Net Income Climbs

Williams-Sonoma Inc. (NYSE:WSM) reported its results for the fourth quarter. Williams-Sonoma is a retailer of products for the home. The retail segment of its business sells products through five retail store concepts: Williams-Sonoma, Pottery Barn, Pottery Barn Kids, West Elm and Williams-Sonoma Home.

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Williams-Sonoma Earnings Cheat Sheet for the Fourth Quarter

Results: Net income for Williams-Sonoma Inc. rose to $122.6 million ($1.17 per share) vs. $113.4 million ($1.05 per share) in the same quarter a year earlier. This marks a rise of 8.1% from the year-earlier quarter.

Revenue: Rose 6.1% to $1.27 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Williams-Sonoma Inc. beat the mean analyst estimate of $1.13 per share. Analysts were expecting revenue of $1.25 billion.

Quoting Management: Laura Alber, President and Chief Executive Officer commented, “Fiscal 2011 was a year of milestones – both in terms of operational performance and progress against our long-term growth initiatives. Through strong execution and a superior multi-channel strategy, we delivered record earnings and profitability in a promotional environment, never losing sight of our mission to enhance our customers’ lives at home.”

Key Stats:

The company has now seen its net income increase for three consecutive quarters. In the third quarter, net income rose 18.9% and in the second quarter, the figure rose 27.8%.

The company has now topped analyst estimates for the last four quarters. It beat the mark by 3 cents in the third quarter, by one cent in the second quarter, and by 2 cents in the first quarter.

Revenue has increased for four consecutive quarters. Revenue increased 6.3% to $867.2 million in the third quarter. The figure rose 5.1% in the second quarter from the year earlier and climbed 7.4% in the first quarter from the year-ago quarter.

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the first quarter of the next fiscal year has moved down from 34 cents a share to 33 cents over the last ninety days. For the fiscal year, the average estimate has moved down from $2.26 a share to $2.20 over the last ninety days.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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To contact the reporter on this story: Derek Hoffman at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com