PIR stock is one of the leading losers on Thursday after Pier 1 Imports Inc (NYSE:PIR) reported that comparable sales fell 12.6% in Q2 and gross margin tumbled as well.
Increased Q2 Loss
Over the past few years, most retailers, save for Amazon (NASDAQ:AMZN), have been struggling, and the factors behind the struggle have been manifold. One retail company that is certainly within that struggling group is Pier 1 Imports, which is based out of Texas. The company released its financial results for the second quarter on Wednesday and numbers made for grim reading. Pier 1 not only made significant losses, but its earnings per share missed analysts’ estimates by a significant margin.
The company reported a staggering loss of $100.6 million in the quarter and the company blamed the clearance sales tactics as the main reason for the reversal. Pier 1 recorded net sales of $304.6 million for the quarter and that was a significant drop from the net sales of $355.3 million in the prior-year period.
Naturally, PIR stock got pounded as well and slid by as much as 16% to $10.10 after the announcement.
The net losses for the quarter amounted to a loss per share of $24.29, and this is a significant rise from the $12.68 per share worth of losses in the same quarter in 2018. In this particular quarter, the company had 951 stores under control, which reflects a drop of 38 stores from the prior-year period.
The company’s situation over recent months has not been particularly great, and the drop in the number of stores is an indication of the sort of struggle it is currently going through. Pier 1 Imports, which is involved in the home furnishings space, has revealed that in 2019 alone it has had to close down as many as 70 stores.
The company is currently in discussions with landlords and is prepared to close as many as 140 stores if things are not worked out. The closure of that many stores will roughly constitute 15% of its existing stores, and it would definitely not be something that investors would want to hear.
Despite today’s slump, PIR stock is still up over 130% so far in September. However, the stock has tumbled 65% over the past year.
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