Pier 1 sales climb 11.8% in 4Q, capping strong year

Larry Thomas -- Furniture Today, April 5, 2012

FORT WORTH, Texas — Pier 1 Imports said sales rose 11.8% in the quarter ended Feb. 25 as the retailer capped its fiscal year with solid gains in operating income, gross margin and net income.

The company said sales totaled $476.8 million in the fiscal fourth quarter, up from $426.6 million in the fourth quarter of the previous fiscal year. Same-store sales were up 10.3%.

Net income totaled $115.2 million or $1.04 per share, well above the $57.1 million or 48 cents per share in the comparable quarter. The most recent quarter, however, was boosted by one-time tax benefits that added 56 cents per share to the total.

Merchandise margins stood at 59.5% for the quarter and gross margins were 45.5%, representing increases of 1.1 and 2.7 percentage points from the comparable quarter, respectively.

The results were much the same for the fiscal year that ended Feb. 25. The retailer said sales rose 9.8% to $1.53 billion and same-store sales rose 9.5%. That gave the company a cumulative three-year, same-store increase of 21.5%.

Net income for the year totaled $168.9 million or $1.48 per share. That compares with $100.1 million or 85 cents per share in the previous fiscal year. The most recent year included one-time tax benefits of 56 cents per share.

"We are extremely pleased with our fiscal 2012 results, which reflect solid execution under our three-year growth plan," said Alex Smith, president and CEO. "The enhancements we've made across the store portfolio - along with improvements to merchandising, in-store presentation and service - are resonating with customers and driving increased traffic and sales."

Smith said the company is beginning the new fiscal year in a strong position, and is poised for a nationwide rollout of its e-commerce site, Pier 1 To You, this summer.

"The business continues to be a strong cash flow generator, providing us with the resources and flexibility to invest in our stores, e-commerce platform, and systems and technology development to ensure that we're meeting the needs of the Pier 1 Imports customer as we transition into an industry-leading multi-channel retailer," he said.

For the current year, Pier 1 is projecting earnings per share of $1.06 to $1.12. Since it will be a 53-week fiscal year, the extra week will add one to two cents to the earnings, the company said.