Fort Worth, TX, December 15, 2005--Pier 1 Imports reported a quarterly loss and said it probably would miss its December sales forecast because of "unpredictable" sales trends and stiff competition.
The company, in the process of revamping its merchandise line with more modern styles in the hope of winning back customers, said it would not provide financial forecasts for the current quarter because of the sales uncertainty.
Pier 1 reported a loss of $7.2 million, or $0.08 per share, for the third quarter ended on November 26, compared with year-earlier earnings of $19.5 million, or $0.22 per share.
Analysts had forecast a loss of $0.09 per share.
Quarterly sales fell 2.4 percent to $476.2 million, while sales at stores open at least a year--a key retail measure known as same-store sales--fell 6.5 percent.
The retailer said it increased marketing and store payroll spending during the quarter, and also distributed two fall catalogs in a bid to improve its brand image.
Pier 1 has struggled to compete with trendy offerings from discounters and specialty retailers, and has been trying to bring in contemporary furniture instead of the wicker styles that have been its hallmark.
But the turnaround is taking time, and Pier 1 said its December same-store sales forecasts for low single-digit growth, "now do not look achievable due to unpredictable sales trends since the Thanksgiving weekend and the heavy promotional environment."
It now expects a same-store sales decline in the mid-single digit range, unless the second half of the month is significantly better than current trends.
The retailer said it was "eagerly" looking forward to early spring, when more modern merchandise lines arrive.
