Pier 1 Imports president and CEO Alex W. Smith identified misguided marketing and store assortments as the primary causes for the retailer’s poor earnings and performance for the second quarter ended Aug. 31.
The retailer substantially missed expectations with a 32% decline in net income for the second quarter of fiscal 2014 compared to the same period last year. Net income totaled $17.8 million in the most recent fiscal quarter, down from $26.2 million.
Total sales were $395.6 million, a 7.6% increase from $367.6 million a year earlier. Comparable store sales increased 3.5% during the second quarter.
“During the second quarter, the efforts focused around our short- and long-term goals fell slightly out of balance,” Smith said. “In particular, our marketing initiatives did not include appropriate messaging around clearance and promotional activity in our stores, or customer acquisition generally, which contributed to lower than expected store traffic. We should also have done a better job of flowing new product to the stores and reflecting those items in the floor set.”
Looking ahead, Pier 1 expects full-year revenue growth of a high-single-digit rate and also plans to return to advertising on network TV during the upcoming holiday season.