Pier 1 Imports reports higher profits as online business grows

Pier 1 Imports closed its 2017 fiscal year with 1,018 stores, 14 fewer than a year earlier.
Pier 1 Imports closed its 2017 fiscal year with 1,018 stores, 14 fewer than a year earlier. The Associated Press

Pier 1 Imports finished its fiscal year with higher profits in the fourth quarter, driven by a slight increase in same-store sales and more growth online.

The Fort Worth-based home furnishings retailer said Wednesday its net income for the three months ending Feb. 25 totaled $26.6 million, or 33 cents per share, compared with $18.7 million, or 23 cents a share, a year ago. Net sales declined by 2.6 percent to $528.4 million, but comparable sales — at stores open at least a year — increased 0.2 percent.

E-commerce business totaled $103.1 million, up 28 percent from the previous year, reaching nearly 20 percent of total sales.

For all of fiscal 2017, Pier 1 recorded net income of $30.1 million, or 37 cents a share, off from $39.6 million the previous year.

Terry E. London, the board chairman who has served as interim President and Chief Executive Officer since Alex Smith retired at the end of December, said the company gained momentum in the second half of the year, citing “positive company comparable sales, improved merchandise margins, controlled operational costs and increased profitability.”

The company expects sales to expand over the next year, forecasting net sales growth of 2-3 percent for the year and full-year earnings ranging from 46 to 52 cents a share.

Last week, Pier 1 announced that Alasdair James, the president of Kmart, had been selected as its new president and CEO. He is scheduled to start on May 1.

In recent years, Pier 1 has stumbled as invested to expand online and integrate the digital business with its store base in an omni-channel strategy, giving shoppers the opportunity to order from their phone or computer and pick up products at neighborhood stores.

But executives have also maintained confidence in the brick-and-mortar business even as other retailers have been trimming locations. Pier 1 said it closed the year with 1,018 stores, just 14 fewer than a year ago, and plans to reduce its store count by 20-25 stores over the next year.

Last month, the company engaged Cushman & Wakefield to manage its retail real estate portfolio with the goal of reducing costs.

The financial results were released after the close of trading. In after-hours trading, Pier 1 shares (ticker: PIR) lost 25 cents, or more than 3 percent, to $7 a share.

Steve Kaskovich: 817-390-7773, @stevekasko