SAN FRANCISCO-Williams-Sonoma Inc., which operates the Williams-Sonoma and Pottery Barn brands, plans to open 57 new stores this year, representing a 7% increase in leased square footage compared with 2005. Specifically, the company will expand Williams-Sonoma by 19 units and Pottery Barn by 16 stores.

Williams-Sonoma plans to open nine new stores in the second quarter, following the opening of 12 during the first quarter, bringing its total store base to 569 units. The first-quarter openings included two Pottery Barn Kids, the concept that had the strongest comp-store sales increases during the third quarter at 3.3%. Overall, the company achieved comp-store sales growth of 1.3% for the quarter on top of 5% comp increases for the same period last year.

For the first quarter, the company’s revenues increased 10.2% to $794.3 million, versus $720.7 million in the first quarter of fiscal-year 2005. Net earnings decreased 11.7% to $23.1 million, or 20 cents per diluted share, versus $26.2 million or 22 cents per diluted share in the first quarter of fiscal 2005.

The company’s quarterly profit was impacted by a charge related to its Hold Everything brand. Excluding this impact, net earnings for the first quarter of fiscal year 2006 would have increased 15.7% to $30.3 million, or 26 cents per diluted share, versus $26.2 million or 22 cent per diluted share in the first quarter of fiscal 2005.

Williams-Sonoma Inc.’s CEO Ed Mueller said during the earnings conference call that he was pleased with the company’s performance. However, he indicated that the company expects some volatility with customer demand. As a result, the company decreased its second-quarter guidance.

For the second quarter, Williams-Sonoma expects to achieve net revenues of between $842 million and $856 million. The earlier guidance put the range between $858 million and $872 million. Same-store sales growth is projected to be in the range of 1.5% to 3.5%, versus previous guidance in the range of 3% to 5%.

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