Williams-Sonoma, Inc. (WSM) has reported a marginal fall of a 0.11 percent in profit for the quarter ended Apr. 30, 2017. The company has earned $39.56 million, or $0.45 a share, compared with $39.60 million or $0.44 a share, a year ago. On an adjusted basis, earnings per share were at $0.51 for the quarter compared with $0.53 in the same period last year.
Revenue during the quarter went up marginally by 1.25 percent to $1,111.51 million from $1,097.82 million in the previous year period. Gross margin for the quarter contracted 15 basis points over the previous year period to 35.61 percent. Total expenses were 94.38 percent of quarterly revenues, up from 94.21 percent for the same period last year. That has resulted in a contraction of 17 basis points in operating margin to 5.62 percent.
Operating income for the quarter was $62.47 million, compared with $63.52 million in the previous year period.
However, the adjusted operating income for the quarter stood at $68.18 million compared to $76.75 million in the prior year period. At the same time, adjusted operating margin contracted 86 basis points in the quarter to 6.13 percent from 6.99 percent in the last year period.
Laura Alber, president and chief executive officer, commented, "In the first quarter, we saw strong sequential improvement in the Pottery Barn brand, demonstrating the effectiveness of the brand initiatives that we are implementing. West Elm, our newer businesses (Rejuvenation and Mark and Graham), and our company-owned global operations delivered another quarter of double-digit growth, and Williams Sonoma started the year off strongly. We also continued to realize positive results from our supply chain initiatives, as we drive continuous improvements across the organization to deliver increased efficiencies and a superior customer experience."
For the second-quarter 2017, Williams-Sonoma, Inc. forecasts revenue to be in the range of $1,195 million to $1,230 million. The company expects diluted earnings per share to be in the range of $0.55 to $0.61.
For fiscal year 2017, Williams-Sonoma, Inc. forecasts revenue to be in the range of $5,165 million to $5,265 million for fiscal year 2017. For financial year 2017, the company forecasts adjusted operating income to grow in the range of 9.40 percent to 9.60 percent. For fiscal year 2017, the company expects diluted earnings per share to be in the range of $3.39 to $3.59. The company expects diluted earnings per share to be in the range of $3.45 to $3.65 on adjusted basis.
Operating cash flow remains negative
Williams-Sonoma, Inc. has spent $46.38 million cash to meet operating activities during the quarter as against cash outgo of $72.66 million in the last year period.
The company has spent $32.15 million cash to meet investing activities during the quarter as against cash outgo of $27.86 million in the last year period.
The company has spent $41.32 million cash to carry out financing activities during the quarter as against cash inflow of $6.80 million in the last year period.
Cash and cash equivalents stood at $93.98 million as on Apr. 30, 2017, down 5.28 percent or $5.24 million from $99.22 million on May 01, 2016.
Debt comes down significantly
Williams-Sonoma, Inc. has recorded a decline in total debt over the last one year. It stood at $45 million as on Apr. 30, 2017, down 55 percent or $55 million from $100 million on May 01, 2016. Williams Sonoma has recorded a decline in short-term debt over the last one year. It stood at $45 million as on Apr. 30, 2017, down 55 percent or $55 million from $100 million on May 01, 2016.
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