Pier 1 Imports, Inc. (PIR: Quote), a specialty retailer of decorative home furnishings and gifts, Thursday lifted its earnings outlook for fiscal 2013 for the third time, after it posted a higher profit for the third quarter. Earnings per share and revenues for the quarter beat Wall Street analysts' expectations.
The company said its results were benefited by about 11 percent growth in sales, with an increase in comparable-store sales backed by a rise in store traffic and higher average ticket.
The board of Pier 1 has declared a higher quarterly dividend and authorized a new $100 million share repurchase program, effective immediately.
Alex Smith, president and chief executive officer of the company said, "Our third quarter results represent the 13th consecutive period of growth in comp store sales and earnings per share...This marks the Company's first full quarter of e-Commerce sales and we're pleased with the initial results..."
The company noted that the combination of its sizeable store base and e-Commerce capabilities are providing it with a powerful platform for growth.
In the third quarter, the company's net income increased to $23.69 million or $0.22 per share from $22.99 million or $0.21 per share in the previous year.
Excluding estimated impact of Hurricane Sandy and utilizing an estimated 35.6 percent annual effective tax rate for fiscal 2013, adjusted earnings for the recent quarter were $0.25 per share. On average, 12 analysts polled by Thomson Reuters expected earnings per share of $0.24 for the quarter. Analysts' estimates typically exclude one-time items.
Net sales for the quarter grew 10.9 percent to $424.53 million, which also came above analysts' estimate of $418.49 million. Comparable-store sales increased 7.9 percent, against last year's growth of 7 percent.
Merchandise margins at the store level were essentially flat with last year, the company stated. Store occupancy costs declined to 16.3 percent of sales, compared to 17.3 percent of sales a year earlier.
Pier 1 said its fourth quarter and fiscal year 2013 will include 14 weeks and 53 weeks, respectively. The financial guidance for the fiscal 2013 fourth quarter is on a 13-week basis, the company said. The 14th and 53rd week is expected to contribute about $25 million to total sales and about $0.02 to earnings per share.
Looking ahead to the fourth quarter, the company expects adjusted earnings per share to be in the range of $0.57 to $0.61. GAAP earnings per share is anticipated to be between $0.55 and $0.59 per share.
Analysts project fourth-quarter earnings of $0.58 per share. The company sees comparable-store sales growth for the quarter to be in the mid single-digit range.
For fiscal 2013, both GAAP and non-GAAP earnings per share are now estimated to range between $1.17 and $1.21, with comparable-store sales growth in the mid single-digit range. Thirteen analysts anticipate earnings of $1.17 per share for the fiscal year.
Earlier, the company forecast 52-week fiscal 2013 non-GAAP earnings per share of $1.10 to $1.16.
In addition, the board declared a quarterly cash dividend of $0.05 per share, up 25 percent from the prior quarterly dividend, to shareholders of record on January 16, 2013, payable on January 30.
PIR closed Wednesday's regular trading at $19.08 on the NYSE.
by RTT Staff Writer
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