Sandy Slams Pier 1, but not Q3 Sales
December 26, 2012,
With the release earlier this month of its initial third quarter results, the home furnishings chain said it estimates the impact of lost sales and costs associated with storm to be approximately 2 cents per share, net of tax, for quarter.
In the days immediately following the storm, as many as 225 Pier 1 stores were closed, primarily because of power outages, and 50 stores operated on reduced hours. All stores were reopened and fully operational by the end of November's second week with the exception of one store located in Long Island, New York, which remains closed due to storm damage.
"While a large number of our stores experienced closure and disruption due to Sandy, our focus was directed first and foremost on the safety and well-being of our associates and others in need," said Alex Smith, president and ceo. "I am extremely proud of and grateful to our associates for their efforts to reopen our stores quickly, even though their own lives were, and in some cases still are, disrupted."
Total sales for the quarter improved 10.9% to $425 million compared to $383 million in the year-ago quarter. Comparable store sales increased 7.9%, primarily due to gains in store traffic and higher average ticket.
"We're pleased to deliver strong sales growth this quarter, as customers responded particularly well to our fall assortments. Excluding the impact of Hurricane Sandy, we estimate that third quarter comp store sales would have increased slightly over 9%," Smith explained.
Gross profit for the quarter is expected to be approximately 43.9% of sales for the third quarter versus 43.2% of sales last year. Earnings per share are projected to be approximately 22 cents compared to 21 in 2011's third quarter.
Year to date, total sales were up 9.0% to $1.153 billion, and comps grew 7.3% on top of a 9.2% increase in the year-ago period.
"We have had a terrific start to the holiday season, including a very strong Thanksgiving weekend, and believe the business is ideally positioned with a compelling merchandise assortment and multiple ways to shop the Pier 1 Imports brand, including both in-store and online," Smith said.