01—Abstract
Summary
Summary of the 10-K filed March 29, 2012. Cited figures are marked; the original filing is the authoritative source.
Williams-Sonoma, Inc. reported record fiscal 2011 results for the 52 weeks ended January 29, 2012.
Net revenues rose 6.2% to $3,720,895 thousanda from $3,504,158 thousand, and diluted earnings per share increased to $2.22 from $1.83. Net earnings were $236,931 thousand, up from $200,227 thousand. Gross margin held at 39.2% of net revenues, while operating income rose to $381,732 thousand, or 10.3% of net revenues, from 9.2% a year earlier.
Comparable brand revenue grew 7.3%, led by West Elm (up 30.3%) and Pottery Barn (up 7.6%), while Williams-Sonoma brand comparable brand revenue declined 0.3%. The direct-to-customer segment grew to 43.9% of net revenues, with e-commerce net revenues up 17.9% to $1,410,236 thousandb. Management expects direct-to-customer to exceed 50% of revenues over the next three years.
For fiscal 2012, a 53-week year, management guided to net revenue growth of 6% to 8%, diluted EPS of $2.37 to $2.47c, capital investment of $200 million to $220 million, and more than $240 million returned to stockholders through repurchases and dividends. The company ended the year with $502,757 thousand in cash, no borrowings under its $300 million credit facility, and total stockholders' equity of $1,255,262 thousand. Capital returns were significant during the year.
The company repurchased 5,384,036 shares for approximately $194,429 thousandd and paid $68,877 thousand in dividends. In January 2012 the Board raised the quarterly dividend from $0.17 to $0.22 per share and authorized a new $225 million repurchase program, of which $155,571 thousand remained at year-end. The company also acquired Rejuvenation Inc. on November 1, 2011, for approximately $25,657 thousand.
02—Key points
Key Highlights
- Net revenues rose 6.2% to $3,720,895 thousand; comparable brand revenue grew 7.3%, with comparable store sales up 3.5%.
- Diluted EPS was $2.22 versus $1.83 in fiscal 2010; net earnings were $236,931 thousand versus $200,227 thousand.
- Operating income was $381,732 thousand, or 10.3% of net revenues, up from 9.2% in fiscal 2010.
- E-commerce net revenues increased 17.9% to $1,410,236 thousand, and direct-to-customer reached 43.9% of total net revenues.
- Fiscal 2012 guidance: net revenue growth of 6% to 8%, diluted EPS of $2.37 to $2.47, and capital investment of $200 million to $220 million.
- Quarterly dividend raised from $0.17 to $0.22 per share in January 2012, and a new $225 million repurchase authorization was approved, with $155,571 thousand remaining at year-end.
- Cash of $502,757 thousand at year-end, no borrowings under the $300 million unsecured revolving credit facility.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2012, Williams-Sonoma kept $0.06.
- Revenue$3.72B100.0%
- Cost of revenue−$2.26B60.8%
- Gross profit$1.46B39.2%
- Operating costs−$1.08B29.0%
- Operating income$381.7M10.3%
- Interest, other & tax−$144.8M3.9%
- Net income$236.9M6.4%
Where FY2012 revenue went
$3.72B- Cost of revenue: $2.26B, 61% of revenue
- SG&A: $1.08B, 29% of revenue
- Net income: $236.9M, 6.4% of revenue
- Interest, other & tax: $144.8M, 3.9% of revenue
Kept 6.4% as net incomeNet income $236.9M · 6.4%
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2012filed March 29, 2012Financial Statements
FY2012 against FY2011
| Line item | FY2012FY2011 | Change |
|---|---|---|
| Revenue | $3.72B$3.50B | +6.2% |
| Gross Profit | $1.46B$1.37B | +6.3% |
| SG&A Expenses | $1.08B$1.05B | +2.6% |
| Operating Income | $381.73M$323.41M | +18.0% |
| Net Income | $236.93M$200.23M | +18.3% |
| EPS (Basic) | $2.27$1.87 | +21.4% |
| EPS (Diluted) | $2.22$1.83 | +21.3% |
| Shares Outstanding (Basic) | 104.35M106.96M | −2.4% |
| Shares Outstanding (Diluted) | 106.58M109.52M | −2.7% |
05—Questions
Frequently Asked Questions
How did Williams-Sonoma perform in fiscal 2011?
Net revenues grew 6.2% to $3,720,895 thousand and net earnings rose to $236,931 thousand from $200,227 thousand. Diluted EPS increased to $2.22 from $1.83, and operating margin improved to 10.3% from 9.2%.
Which brands drove growth in fiscal 2011?
West Elm comparable brand revenue rose 30.3%, Pottery Barn rose 7.6%, Pottery Barn Kids rose 7.4%, and PBteen rose 7.4%. Williams-Sonoma brand comparable brand revenue declined 0.3%, primarily due to promotional activity on nationally branded products, particularly in the retail channel.
What is management's outlook for fiscal 2012?
Management expects net revenues to increase 6% to 8% and diluted EPS of $2.37 to $2.47 in fiscal 2012, a 53-week year. Capital investment is expected to be $200 million to $220 million, with $15 million to $20 million in incremental SG&A, and more than $240 million is expected to be returned to stockholders through repurchases and dividends.
How strong is the balance sheet and liquidity position?
The company held $502,757 thousand in cash and cash equivalents at year-end and had no borrowings under its $300 million unsecured revolving credit facility. Stockholders' equity was $1,255,262 thousand, and management stated it was in compliance with its bank covenants.
How much did the company return to shareholders in fiscal 2011?
The company repurchased shares for approximately $194,429 thousand and paid $68,877 thousand in dividends in cash, totaling $263,306 thousand. Dividends declared were $76,308 thousand, and the Board increased the quarterly dividend to $0.22 per share in January 2012.
06—Continue