Pier 1 4Q sales up 6.6%, profits dip 10.6%
By Clint Engel -- Furniture Today, April 4, 2004
FORT WORTH, Texas — Pier 1 Imports posted a 10.6% drop in its fourth-quarter net income, and its first annual same-store sales decline in 12 years, but is looking for a nice bounce thanks in part to a fresh advertising campaign.
Net income for the 1,179-store home furnishings specialty retailer was $48.3 million in the quarter ended Feb. 28, down from $54 million in the same period a year ago.
The latest quarter included a $1.6 million after-tax charge related to a California labor litigation settlement. Same-store sales for the period fell 2.7%.
For the year, Pier 1's net income dropped 8.8% — including the charge — to $118 million from $129.4 million. Sales for the year rose to a record $1.9 billion, but same-store sales fell 2.2% after 11 consecutive years of increases.
While not a terribly disappointing year, Pier 1 Chairman and CEO Marvin Girouard said in a conference call that it "wasn't an exciting year either" and was "very challenging."
But that could be changing with the launch last month of an advertising campaign featuring designer Thom Filicia from television's hit show "Queer Eye for the Straight Guy."
Filicia replaces actress Kirstie Alley, who appeared in spots that served the retailer well for most of a three-year stint until finally going a little stale, Girouard said.
And while the company wants to be conservative in its sales projections, Girouard said its timing with Filicia is perfect, as Pier 1 is tying in at a time when Filicia is gaining popularity and media attention.
One of the first two Filicia commercials recently was ranked in an Intermedia Advertising Group's list of top 10 most effective new ads, based on viewers' ability to recall the spots and remember the brand and products, he said.
In the new commercials, Pier 1 is showing more product than in former spots, and believes they will be effective traffic-builders. Girouard said that in future commercials, the retailer will draw more on Filicia's design expertise.
The company opened 149 stores last year, including 120 new Pier 1 stores and 22 Cargokids units. It closed 77 Pier 1 and seven Cargokids stores.
This year, the company plans to open 115 to 120 Pier 1 stores and close or relocate 40.
Girouard said Pier 1 now sees an opportunity to grow beyond the 1,500 units it initially thought possible for the United States and Canada. It also will open 15 to 20 Cargokids stores this year and close two under-performing stores from the initial acquisition.
Same-store sale for March and the current quarter are projected to increase in the 2% to 4% range, and first-quarter earnings per share are expected to be in the range of 21 to 24 cents, compared to 21 cents in the same period last year.
| Quarter ended 2/28 | 2004 | 2003 | Change |
|---|---|---|---|
| Sales | $555,256,000 | $521,035,000 | 6.6% |
| Operating income | 89,177,000 | 97,505,000 | (8.5%) |
| Net income | 48,309,000 | 54,032,000 | (10.6%) |
| Earnings per share | 0.53 | 0.57 | (7.0%) |
| Year ended 2/28 | 2004 | 2003 | Change |
| Sales | $1,868,243,000 | $1,754,867,000 | 6.5% |
| Operating income | 237,084,000 | 251,086,000 | (5.6%) |
| Net income | 118,001,000 | 129,386,000 | (8.8%) |
| Earnings per share | 1.29 | 1.36 | (5.1%) |
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Pier 1 sales decline 10.9%
Apr 13, 2009 -
Pier 1 reports $38.8M profit
Dec 21, 2009 -
Pier 1 reports smaller loss in 2Q
Sep 28, 2009 -
Pier 1 loses $36.9M
Dec 21, 2008 -
Pier 1 loss cut; sales off 7%
Sep 23, 2007
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