Fort Worth, June 15, 2006--Pier 1 Imports Inc., said Thursday its first-quarter loss nearly doubled as weak customer traffic contributed to a decline in revenue.
The company's loss grew to $23.2 million, or $0.27 per share, from $12.5 million, or $0.14 per share, a year ago. Excluding a loss from discontinued operations of $407,000, or a penny per share, the company reported a loss from continuing operations of $22.8 million, or $0.26 per share, in the latest period.
Quarterly revenue slipped 3.6 percent to $376.1 million from $390.3 million in the year-ago period, and same-store sales, a key performance measure for retailers, dropped 6.6 percent.
On average, analysts were expecting a loss of 26 cents per share on higher sales of $382.4 million.
"In mid-March, we launched our brand repositioning campaign featuring Pier 1's unique Modern Craftsman merchandise, which included new advertising and new in-store visuals intended to mirror Pier 1's catalogs. During the first quarter, customer traffic remained weak. We recognize that it will take time to attract new customers and inform our existing customers of the significant changes in our merchandise assortment," Chairman and CEO Marvin J. Girouard said in a statement.
The company said higher costs also weighed on quarterly results. While merchandise margins improved to 53.8 percent from 53.2 percent in the year-ago quarter, store occupancy costs increased by $5.1 million and selling, general and administrative costs grew to 39.2 percent of sales from 35.9 percent last year.
Looking ahead, Pier 1 said it continues to see better merchandise margins this quarter compared with last year, but expects June same-store sales to be in the negative low- to mid-teens range compared with last year, when sales were driven by heavier promotions.
