Williams-Sonoma Says Its Earnings Held Steady

Williams-Sonoma Inc., owner of home furnishing retail chains including Pottery Barn, said Tuesday that its fiscal fourth-quarter profit was little changed because of accounting changes and the smallest revenue gain in about nine years.

Net income increased to $102.6 million, or 86 cents a share, from $102.1 million, or 85 cents, a year earlier, the San Francisco-based company said. Revenue climbed 7.9% to $1.08 billion in the three months ended Jan. 30.

Profit was lowered by 9 cents a share because of changes in the way the company accounts for leases, the company said. The same-store sales gain of 1.5% was the smallest for the year, and results at the Pottery Barn chain declined because of an inventory shortage and slowing demand.

Excluding the lease accounting expense, the company met the 95-cent average earnings estimate of 21 analysts surveyed by Thomson First Call.

Profit excluding the effect of a change in the way the company accounts for share-based payments will be 18 cents a share to 20 cents in the current quarter, 25 cents to 27 cents in the second quarter, 29 cents to 31 cents in the third quarter and $1.07 to $1.11 in the fourth quarter, the company said.

Annual profit will be $1.83 to $1.87. Analysts expect profit of 19 cents a share in the first quarter and $1.87 for the year. Before the fourth quarter, Williams-Sonoma’s profit beat analysts’ estimates for at least 10 quarters.

Shares of Williams-Sonoma, which operates about 542 stores, rose $1.62 to $36.70 on the New York Stock Exchange, the biggest gain in seven months.

Chief Executive Edward Mueller added the Williams-Sonoma Home catalog last year and increased distribution of its Hold Everything and West Elm catalogs to boost sales. Catalog and Internet sales rose 7.1%, including a 26% gain in Internet sales.