Pier 1 net sales down by 13.3% in Q3 FY 2020

23 Jan '20

2 min read

Pic: Pier 1

Pier 1's net sales for Q3 '20 (ended on November 30, 2019) decreased 13.3 per cent to $358.4 million, compared to $413.2 million in Q3 '19. Comparable sales decreased 11.4 per cent, primarily because of lower traffic. Gross profit totalled $110.3 million (30.8 per cent of net sales) compared to $130.5 million (31.6 per cent of net sales) for Q3 '19.

Net sales for the 39 weeks ended November 30, 2019 were $977.3 million, a decrease of 14.3 per cent compared to $1.140 billion for the same period of FY '19. Gross profit for the year-to-date period of fiscal 2020 totalled $239.9 million (24.5 per cent of net sales) compared to $344.1 million (30.2 per cent of net sales) for the same period a year ago.

Pier 1 estimated that the shift of certain holiday selling days, which were included in last year's quarter, negatively impacted Q3. The impact of this timing shift is expected to be reversed in the Q4 '20, the company said in a press release.

SG&A (Selling, General and Administrative) expenses for Q3 FY20 were $151.4 million, or 42.2 per cent of net sales, compared to $147.0 million, or 35.6 per cent of net sales, for Q3 FY19.

Operating loss for Q3 FY20 was $53.3 million compared to operating loss of $28.9 million for the prior year period. Net loss tottaled $59.0 million, or ($14.15) per share, which includes transformation costs of approximately $10 million, primarily related to professional fees, and a non-cash charge of $14.1 million related to store impairment. This compares to net loss of $50.4 million, or ($12.49) per share a year ago.

Pier 1 operated 942 stores at the end of this quarter, a decrease of 45 from Q3 '19. Further, to better align its business with the current operating environment, the company intends to reduce its store footprint by up to 450 locations. To reflect the revised store footprint, the company also plans to close certain distribution centers and reduce its corporate expenses. This includes a reduction in corporate headcount.

Founded with a single store in 1962, Pier 1 Imports is a leading omni-channel retailer of unique home décor and accessories. The Company's products are available through 936 Pier 1 stores in the US and online at pier1.com.

Fibre2Fashion News Desk (JL)

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