Pier 1 Imports, Inc., a home furnishings retailer, jumped to third quarter profit compared to a loss last year. The Fort Worth, Texas-based company said merchandise margins during the quarter improved due to significantly reduced markdown and clearance activity and strong input margins. Comparable store sales during the quarter increased 13.7%.
Net income for the quarter amounted to $39 million, or $0.37 per share compared to a net loss of $37 million, or $0.41 per share in the corresponding period last year.
Excluding items net income was $2 million compared to a loss of $30 million for the same period last year. On average, six analysts polled by Thomson Reuters expected the company to report a loss of $0.05 per share for the quarter. Analysts' estimates typically exclude special items, RTTNews reports.
Excluding a tax benefit and other items, profit was $2.1 million.
The performance beat the predictions of analysts polled by Thomson Reuters, who anticipated a loss of 5 cents per share. These estimates typically exclude one-time items.
Sales grew 9 percent to $327.1 million from $300.9 million, with sales at stores open at least a year surging 13.7 percent. This figure is a key indicator of retailer performance since it measures growth at existing stores rather than newly opened ones.
Wall Street expected total revenue of $321.6 million for the quarter.
Like many retailers, Pier 1 has kept a close eye on inventory and expenses during the recession. The company cut its inventory to $340 million during the quarter, down from $399 million last year. It also lowered selling, general and administrative expenses to $112 million from $115 million, BusinessWeek reports.
Fort Worth, Texas-based Pier 1 (PIR 5.29, +0.31, +6.23%) also said it now plans to close
fewer stores during the fourth quarter than it initially slated, and it expects to boost capital spending in the coming fiscal year.
Not too bad for a company that not long ago was struggling with bloated inventory, merchandise missteps and consistent losses.
The news comes as other retailers have also reported an uptick in sales of home furnishings and accessories. Best Buy Co. (BBY 41.19, -0.10, -0.24%) , Williams-Sonoma Inc. (WSM 21.75, -0.03, -0.14%) , Home Depot Inc. (HD 28.86, -0.10, -0.35%) , and TJX Cos. (TJX 36.73, -0.48, -1.29%) have all seen some improvement, MarketWatch reports.
US President Joe Biden and Iraqi Prime Minister Mustafa Al Qadimi signed an agreement on July 26 to formally end the USA's military presence in the country by the end of the year