Williams-Sonoma(WSM) - 2024 Q4 - Annual Results

Revenue Performance - Q4 comparable brand revenue decreased by 6.8%, with a 2-year comp of -7.4% and a 4-year comp of +29.1%[4] - Net revenues for FY 2024 decreased to $7.75 billion, a 9.9% decline compared to FY 2023's $8.67 billion[18] - Pottery Barn's net revenues declined by 9.7% to $3.21 billion in FY 2024, while West Elm saw a sharper decline of 18.8% to $1.86 billion[18] - Fiscal 2024 net revenue growth is expected to be in the range of -3% to +3%, with comps expected to be between -4.5% to +1.5%[8] Profitability and Margins - Q4 operating margin was 20.1%, with diluted EPS of $5.44[4] - Full-year operating margin for fiscal 2023 was 16.4%, with diluted EPS of $14.85, beating the comp guidance of -10% to -12%[2] - Gross margin for Q4 was 46.0%, an increase of 480 basis points year-over-year, driven by higher merchandise margins and supply chain efficiencies[4] - Gross profit for FY 2024 was $3.30 billion, representing 42.6% of net revenues, slightly up from 42.4% in FY 2023[18] - Gross profit for the thirteen weeks ended January 28, 2024, was $1,048,615, representing 46.0% of revenues, compared to $1,009,850 (41.2% of revenues) for the same period in 2023[25] - Operating income for the thirteen weeks ended January 28, 2024, was $458,091, representing 20.1% of revenues, compared to $469,787 (19.2% of revenues) for the same period in 2023[25] - Adjusted Operating Income for the fiscal year ended January 28, 2024, was $1,567,219[28] - NOPAT (Net Operating Profit After Tax) for the fiscal year ended January 28, 2024, was $1,169,145[28] - Return on invested capital (ROIC) for the fiscal year ended January 28, 2024, was 45.0%[30] Expenses and Costs - Q4 SG&A expenses were $591 million, an increase of 9.3% year-over-year on a GAAP basis[4] - Selling, general and administrative expenses for the thirteen weeks ended January 28, 2024, were $590,524, representing 25.9% of revenues, compared to $540,063 (22.0% of revenues) for the same period in 2023[25] - Occupancy costs for the thirteen weeks ended January 28, 2024, were $208,020, representing 9.1% of revenues, compared to $203,715 (8.3% of revenues) for the same period in 2023[25] Liquidity and Cash Flow - The company maintained a strong liquidity position with $1.3 billion in cash and $1.7 billion in operating cash flow[8] - Cash and cash equivalents increased significantly to $1.26 billion as of January 28, 2024, compared to $367.34 million in the previous year[21] - Net cash provided by operating activities increased to $1.68 billion in FY 2024, up from $1.05 billion in FY 2023[24] - Total assets increased to $5.27 billion as of January 28, 2024, up from $4.66 billion in the previous year[21] - Total assets as of January 28, 2024, were $5,273,548, compared to $4,663,016 as of January 29, 2023[30] Dividends and Share Repurchases - The company increased its quarterly dividend by 26% to $1.13 per share and authorized a new $1 billion stock repurchase program[1][8] - Repurchases of common stock decreased to $313.00 million in FY 2024, compared to $880.04 million in FY 2023[24] Inventory Management - Merchandise inventories decreased by 14.4% year-over-year to $1.2 billion[8] - Merchandise inventories decreased by $209.77 million to $1.25 billion as of January 28, 2024[21] Store Operations - Total retail stores decreased from 530 at the end of FY 2023 to 518 at the end of FY 2024, with Pottery Barn closing 8 stores and Williams Sonoma closing 7 stores[22] Earnings and EPS - Earnings per share (EPS) decreased to $14.55 (diluted) in FY 2024 from $16.32 in FY 2023[18] - Diluted EPS for the thirteen weeks ended January 28, 2024, was $5.44, compared to $5.28 for the same period in 2023[25] - Net earnings for the fiscal year ended January 28, 2024, were $949,762[28] Fiscal Year Impact - The additional week in fiscal 2024 is expected to contribute 150 basis points to revenue growth and 10 basis points to operating margin[8]