Pier 1 announces major store closing initiative as Q3 loss widens
Pier 1 Imports is significantly reducing the size of its store portfolio and corporate headcount as it seeks to cut costs and turnaround its ailing operations.
The struggling home décor retailer announced that it will reduce its store footprint by nearly half — or up to 450 locations— in an effort to “better align its business with the current operating environment.” Pier I currently operates 936 stores in the U.S.
In line with its revised store footprint, Pier 1 also plans to close certain distribution centers and reduce its corporate expenses, including a reduction in corporate headcount.
The company said it received consent from its lenders On Jan. 6 under the revolving credit facility to permit the store reduction and related actions.
“Although decisions that impact our associates are never easy, reducing the number of our brick-and-mortar locations is a necessary business decision,” said Robert Riesbeck, who took the reints as CEO https://chainstoreage.com/pier-1-gets-new-ceo-and-more-time-nyseof Pier 1 in November. Riesbeck, who is also Pier 1′s CFO, has prior experience in turnarounds.
Pier 1 revealed the news about the store closings in a dismal third-quarter financial statement. Same-store sales decreased 11.4% for the period, ended Nov. 30, and net sales fell 13.3% to $358.4 million. The chain’s net loss widened to $59.0 million, or ($14.15) per share.
“Fiscal third-quarter sales and margins remained under pressure as we completed our efforts to clear out non-go-forward merchandise,” said Riesbeck. Looking ahead, we believe that we will deliver improved financial results over time as we realize the benefits of our business transformation and cost-reduction initiatives.”
Prior to the third quarter, Pier 1 had posted eight straight quarters of declining sales and six consecutive quarterly losses.