Williams-Sonoma Inc WSM
Q4 2011 Earnings Call Transcript

Transcript Call Date 03/08/2012

Operator: Ladies and gentlemen, thank you for standing by. Welcome to the Williams-Sonoma, Inc. Fourth Quarter and Fiscal Year 2011 Earnings and Fiscal Year 2012 Guidance Conference Call. At this time, all participants are in a listen-only mode. We will conduct a question-and-answer session after the presentation. This conference is being recorded.

I would now like to turn this call over to Steve Nelson, Vice President of Investor Relations, to discuss non-GAAP measures and forward-looking statements.

Stephen C. Nelson - VP, IR: Good morning. This morning's conference call should be considered in conjunction with the press releases that we issued earlier today. Our press release in this call contain non-GAAP financial measures that exclude the impact of unusual business events. These non-GAAP financial measures are provided to facilitate meaningful year-over-year comparisons. A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures and an explanation of why these non-GAAP financial measures are useful are discussed in Exhibit 1 and elsewhere in the press release.

The forward-looking statements included in this morning's call constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements address the financial condition, results of operations, business initiatives, guidance, growth plans, and prospects of the Company in 2012 and beyond, and are subject to certain risks and uncertainties that could cause actual results to differ materially from such forward-looking statements. Please refer to the Company's current press releases and SEC filings for more information on these risks and uncertainties. The Company undertakes no obligation to update or revise any forward-looking statements to reflect events or circumstances that may arise after the date of this call.

I will now turn the conference over to Laura Alber, our President and Chief Executive Officer, to discuss our fourth quarter and fiscal year 2011 results and our outlook for 2012.

Laura J. Alber - President and CEO: Good morning, and thank you for joining us. With me today are Pat Connolly, our Chief Marketing Officer; and Julie Whalen, our Acting Chief Financial Officer.

I'll begin by going over our fourth quarter results. Fourth quarter net revenues increased 6% and non-GAAP diluted earnings per share increased 8% to a record $1.17 per share. Throughout the quarter, the strength of our merchandising strategies and flexibility of our multichannel operating model drove increased sales and profits despite a more promotional environment during the holiday period. Post holiday, we saw progressively stronger retail environment and through highly effective marketing and stronger than expected operational execution, we exceeded our revised January guidance on both the top and bottom line.

During the quarter, comparable brand revenues increased 7% and e-commerce revenues increased to better than expected 18%. Strong product assortments including an increased gift assortment in each of our brands were enhanced by highly targeted promotions and e-marketing initiatives in all channels.

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