Pier 1 returns to profitability in Q3

FORT WORTH, Texas Pier 1 Imports reported net income of $39 million, or 37 cents per share, for the third quarter, versus a net loss of $37 million, or 41 cents per share, for the same period last year. Without taking into account the effects of the unusual transactions and expenses that were recorded during the third quarter, net income would have been $2 million compared with a loss of $30 million last year.

Total sales for the third quarter increased to $327 million from $301 million in the year-ago quarter. Comparable-store sales during the quarter increased 13.7%.

Alex Smith, president and CEO, said, "The results of this past quarter were very gratifying for all of us at Pier 1 Imports. Critical business metrics including traffic, conversion rate and average ticket improved throughout the quarter yielding strong positive comparable-store sales. Excellent input margins and lower markdown activity generated the highest merchandise margins in over six years."

The company announced that it has executed a three-year renewal and extension of the employment agreement with Smith. A copy of the agreement has been filed with the SEC.

Chairman of the board, Dr. Michael Ferrari said, “Since Alex’s arrival in February 2007, Pier 1 Imports has been on a path to return to profitability. His vision and leadership have guided our company through a challenging economic environment and he has made the tough decisions that have enabled us to emerge much stronger and better positioned to meet the changing needs of consumers. This extension of his employment agreement demonstrates our confidence in his ability to continue to lead this company as we look ahead to an even brighter future.”