Pier 1 Continues to Erode: Fool by Numbers

On Dec. 14, home-furnishing retailer Pier 1 (NYSE: PIR  ) released its third-quarter earnings for the period ended Nov. 25.

  • Sales continue to fall at this troubled retailer. Total sales for the quarter declined 11.8%, while same-store sales fell 12.9%.

  • Fewer sales using more promotional techniques and markdowns dragged the gross margin down 5.7 percentage points. Yikes! At least inventory is coming down.

  • Thirty-nine of 78 investors think Pier 1 will outperform the S&P 500 in our new community intelligence service, Motley Fool CAPS. What do you think? Sign up today and let your voice be heard.

(Figures in millions, except per-share data)

Income Statement Highlights

Q3 2007

Q3 2006

Change

Sales

$402.7

$456.7

(11.8%)

Net Loss*

($72.7)

($5.7)

N/A

EPS

($0.83)

($0.06)

N/A

Diluted Shares

87.5

86.7

0.9%

*Net loss from continuing operations.

Get back to basics with a look at the income statement.

Margin Checkup

Q3 2007

Q3 2006

Change*

Gross Margin

30.9%

36.6%

(5.7)

Operating Margin

(17.6%)

(0.5%)

(17.1)

Net Margin

(18.1%)

(1.2%)

(16.9)

*Expressed in percentage points.

Margins are the earnings engine. See how they work.

Balance Sheet Highlights

Assets

Q3 2007

Q3 2006

Change

Cash + ST Invest.

$172.3

$80.9*

113%

Accounts Rec.

$30.0

$29.4

2%

Inventory

$392.4

$438.8

(10.6%)



Liabilities

Q3 2007

Q3 2006

Change

Accounts Payable

$121.6

$99.8

21.8%

Long-Term Debt

$184.0

$19.0

868.4%

*Includes securitized receivables.

Learn the ways of the balance sheet.

Cash Flow Highlights

YTD 2007

YTD 2006

Change

Cash From Ops.

($84.4)

($158.3)

N/A

Capital Expenditures

($25.2)

($40.2)

N/A

Free Cash Flow

($109.6)

($198.5)

N/A



Find out why Fools always follow the money.

Related Companies:

  • Bed Bath & Beyond (Nasdaq: BBBY  )
  • Restoration Hardware (Nasdaq: RSTO  )
  • Williams-Sonoma (NYSE: WSM  )

Related Foolishness:

Bed Bath & Beyond is both anInside Valueand aStock Advisorselection.

Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so checkFool.com for more of our in-depth discussion of what the numbers mean.

At the time of publication, David Meier did not own shares in any of the companies mentioned. Fool rules for disclosure are here.


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