Pier 1 Reports Decline in March Sales, Sees 1Q Los
Fort Worth, TX, April 7, 2005--Pier 1 Imports reported today that sales for the five-week period ended April 2, 2005 aggregated $147,624,000, a decline of 12.4% from $168,544,000 last year, and comparable store sales declined 18.2% for the month.
Marvin J. Girouard, chairman and chief executive officer, commented, "Sales in March were disappointing. Customer traffic for comp stores was down by double-digits, and average ticket and conversions were down slightly for the month. We feel directly responsible for this poor performance. Our new advertising campaign did not launch until late in the month and store inventories continued to be below plan. Sales were also impacted by inclement weather throughout the country and one less sales day due to an early Easter this year."
Fiscal year 2006 first quarter comparable store sales are projected to be in a range of -8% to -12%. Diluted earnings (losses) per share for the first quarter are currently projected to be in a range of ($0.03) to ($0.10) per share. At this time, the company is not providing additional financial guidance for the remainder of fiscal year 2006.
Mr. Girouard continued, "First quarter's negative projections reflect a conservative forecast and an up-front investment in the business through increased marketing, payroll and other costs to support the company's major initiatives, which are expected to improve traffic and sales over the next few months. Historically, the company's first quarter sales and profits are the smallest of the year.
"In fiscal 2006, we are slowing planned store growth by opening 60 net Pier 1 stores and 2 net Pier 1 Kids stores. This will allow us to improve existing store-level productivity. Our new advertising campaign launched the week of March 21st as part of a fully integrated marketing effort supported by stronger newspaper inserts, TV commercials, radio advertising, a newly designed website, in-store graphics and new Pier 1 shopping bags.
"Although we expect the marketing initiatives to take a few months to be fully effective, we do expect it to create increases in store traffic in the near term. We are being cautious, however, as to how soon sales and profit improvements will occur, as we do not under-estimate the impact of challenging business conditions that currently exist, especially for home furnishings retailers. We are committed to improving the business as we regain market share and implement initiatives that support long-term growth and add shareholder value."
