SF’s Williams-Sonoma declares 2-for-1 split

The Associated Press
Saturday April 20, 2002

SAN FRANCISCO — Williams-Sonoma Inc. said Wednesday it has raised its guidance for 2002 and the first two fiscal quarters of the year, citing stronger sales, better-than-expected gross margins and the success of its cost-management initiatives. 

The San Francisco home-product retailer also declared a 2-for-1 stock split, payable May 9 to shareholders of record April 29. The company hopes to improve market liquidity and demonstrate its confidence in the long-term growth of its brands through this move. 

Williams-Sonoma has about 57 million shares outstanding. Shares of Williams-Sonoma were up $5.49, or more than 11.5 percent, to close at $52.85 in trading on the New York Stock Exchange Wednesday. 

For the 2002 fiscal first quarter ending May 5, Williams-Sonoma expects to earn 17 cents to 19 cents a share, up from a previous view of 3 cents to 4 cents a share and analysts’ consensus estimate of 4 cents a share, according to Thomson Financial/First Call. 

It expects first-quarter revenue of $465 million to $475 million, up from an earlier estimated range of $461 million to $471 million. 

In the first quarter 2001, the company earned $492,000, or 1 cent a share. 

“This is the strongest first-quarter performance in the history of the company,” Chairman Howard Lester said in a release. 

While boosting its guidance, Williams-Sonoma also revised its previous fourth quarter and 2001 financial results, citing changes to its accounting of revenue recognition. 

The firm’s decision follows much-publicized Securities and Exchange Commission inquiries on revenue-recognition practices in various industries. 

Williams-Sonoma worked with the SEC and decided to recognize revenue when it delivered for all merchandise shipped to customers from its distribution warehouses. 

As a result, earnings for the fourth quarter and 2001 declined $1.01 million, or 2 cents a share, putting revised fourth-quarter earnings at $69.4 million, or $1.18 a share, on revenue of $778 million. 

On March 11, the company posted initial fourth-quarter earnings of $70.4 million, or $1.20 a diluted share, on revenue of $787.4 million.