Pier 1 Imports remained under pressure in the second quarter, with sales decreasing and a wider net loss, as the retailer looked to reset fall assortments and make progress on its 2020 action plan.
Net sales for the second quarter of fiscal 2020, ended August 31, decreased 14.3% to $304.6 million, compared to $355.3 million for the second quarter of fiscal 2019. Company comparable sales decreased 12.6% compared to the year ago period, reflecting lower average customer spend, which is primarily attributable to changes in the company’s merchandise mix, as well as decreased store traffic.
Operating loss for the second quarter of fiscal 2020 was $93.1 million compared to operating loss of $62.5 million for the prior year period.
Net loss for the second quarter of fiscal 2020 totaled $100.6 million, or $24.29 per share, which includes transformation costs of approximately $7 million, primarily related to professional fees, and a non-cash charge of $4.3 million related to store impairment. This compares to net loss of $51.1 million, or $12.68 per share a year ago.
Cheryl Bachelder, interim CEO, Pier 1 Imports, said, “As we expected, sales and margins remained under pressure in the second quarter. We exited non-go-forward products through aggressive clearance actions, which was the primary driver of our net loss in the quarter. However, the strategic decision to clear through goods paved the way for our merchandise and marketing reset this fall. Fresh assortments began flowing into stores during the final weeks of the quarter and as we move closer to holiday, we look forward to delivering more of the unique, on-trend seasonal goods the Pier 1 brand is known for.”
Bachelder added, “The organization continues to make progress against our fiscal 2020 action plan, and we remain on track to achieve benefits of $100 to $110 million this year, as previously outlined. While we anticipate that our merchandising and marketing initiatives will start to gain traction during the second half, we expect a gradual recovery and believe we’ll be positioned to demonstrate year-over-year improvement in company comparable sales and gross margin rate beginning in the fourth quarter. Our teams are working diligently to turn the business around and we believe that Pier 1 can prosper once again.”