Pier 1 Sales Same-Store Sales up 6.5% in 4th Quarter

April 7, 2010  by in UnCategorized   

By Home Furnishings Business in Financial Reports on April 8, 2010

Pier 1 Imports Inc. (PIR), Fort Worth, Texas, reported on Thursday fourth-quarter 2009 sales of $396 million, a 1.8 percent increase over the same prior-year period.

For the fiscal fourth quarter ended Feb. 27, Pier 1 had net income of $35 million, compared with a loss of $29 million in fourth-quarter 2008. Same store sales increased 6.5 percent.

For the fiscal year 2009, ended Feb. 27, Pier 1 reported net income of $87 million versus a net loss of $129 million the prior year. Total sales for the fiscal year declined to $1,291 million from $1,321 million last year. The decline in sales during the year was primarily attributable to a net store count reduction of 38 stores. The decrease from store count was partially offset by an increase in comparable store sales of 1.5 percent for the fiscal year.

"Three years ago we started on a journey to return our company to profitability," said President and CEO Alex W. Smith. "Since then, we have improved and strengthened every aspect of our business. Our relationship with our customers, our financial position and our organization are all overwhelmingly stronger than they were. It has long been apparent that we can control costs and expand merchandise margin. Now with a slightly more active economy, we are starting to see top line improvements, which we knew would come eventually. We are extremely pleased that in the fourth quarter we improved our net income by $64 million and delivered an operating margin of 9 percent of sales."

During fiscal 2010, the Company closed 38 Pier 1 Imports stores in North America and ended the year with 1,054 locations.

Looking ahead, Smith commented: "In fiscal 2011, we will continue to reap the benefits from the work we have already done and gain further benefits as we strive to become better retailers and better importers. We believe that we have huge organic growth potential in our business--we are still well below our historical highs in annual sales per square foot and merchandise margin. Although it is a long time until Christmas, the year has started well. March comparable store sales, which benefitted somewhat from the earlier Easter holiday, increased 19.4 percent compared to a decline of 9.7 percent last year, and were driven by increases in traffic, conversion rate and average ticket. Merchandise margins were also well ahead of last year."