Pier 1 loss cut; sales off 7%
By Furniture Today Staff -- Furniture Today, September 23, 2007
Fort Worth, Texas — Specialty retailer Pier 1 Imports posted a loss of $43.4 million in its second quarter, an improvement on the $73.1 million it lost in last year's comparable quarter.
Sales were down 7% from a year ago in the quarter ended Sept. 1 to $370.7 million. Same-store sales — excluding clearance stores, e-commerce and Pier 1 Kids, which the chain is closing — were down 3.6%.
The company said its merchandise margins were 47% in the quarter, which historically has the lowest margins of the year because of its semiannual clearance event in June and July. In addition, margins were reduced by 200 basis points because of the aggressive liquidation of Pier 1 Kids, e-commerce, and clearance of remaining Modern Craftsman merchandise, the line of home furnishings the company has discontinued.
In August, the company said, margins improved to 52%, excluding Pier 1 Kids, e-commerce and clearance stores.
Pier 1 also said its costs were lower, with selling, general and administrative expenses accounting for 34.1% of sales in the latest quarter, compared with 41.3% a year earlier.
The retailer said it continues to improve its efficiency and simplify its organizational structure, and expects to realize cost savings of $100 million this year and $150 million on an annualized basis.
"I am delighted that our strenuous efforts to simplify our business and drive out costs are already significantly improving our bottom line," said President and CEO Alex Smith. "We know that if we continue to focus on execution of our six business priorities, we will be able to reverse five years of deteriorating trends and return to profitability."
For the six months, the company reported a loss of $99.8 million on sales of $700.9 million, compared with a loss of $96.2 million on sales of $746.8 million in the 2006 first half.
| Pier 1 Imports | |||
|---|---|---|---|
| Earnings per share are fully diluted, and all figures in parentheses are losses or declines. | |||
| Quarter ended 9/1 | 2007 | 2006 | Change |
| (a) Includes income tax expense of $1.9 million in the 2007 quarter, $11.2 million in the 2007 six months and $2 million in the 2006 quarter, and income tax benefit of $570,000 in the 2006 six months. Includes a net loss of $407,000 or 1 cent per share from discontinued operations in the 2006 six months. |
|||
| Sales | $344,566,000 | $370,698,000 | (7.0%) |
| Operating income | (29,933,000) | (47,648,000) | — |
| Net income (a) | (43,409,000) | (73,059,000) | — |
| Earnings per share | (0.49) | (0.84) | — |
| 6 months ended 9/1 | 2007 | 2006 | Change |
| Sales | $700,941,000 | $746,790,000 | (6.1%) |
| Operating income | (74,879,000) | (67,979,000) | — |
| Net income (a) | (99,787,000) | (96,231,000) | — |
| Earnings per share | (1.14) | (1.10) | — |
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Pier 1 sales increase 11.8%
Apr 13, 2012 -
Pier 1 reports $38.8M profit
Dec 21, 2009 -
Pier 1 loses $56.4 million
Jun 24, 2007
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