Pier 1 Imports, Inc. (PIR) announced that comparable store sales for month of September increased 9.9%, compared to a decline of 11.7% in September of last year. Third quarter merchandise margins continue to improve on a year-over-year basis as a result of significantly reduced markdown and clearance activity and strong input margins. Inventory levels are expected to peak at the end of the quarter at approximately $350 million.
The company expects that it will have the right during the month of October to terminate the conversion rights of the holders of the company's 9% convertible notes, which were issued during the second quarter. It is expected that the company will exercise that right. To date, about $15 million of the original $61.2 million bonds have either been converted or submitted for conversion into around 6 million shares.
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