Pier 1 Says Customer Traffic Better

FORT WORTH, Texas (AP) — Pier 1 Imports Inc. said Monday that sales at stores open at least a year rose 9.9 percent in September as customer traffic improved. The news sent shares soaring 13.4 percent in aftermarket trading.

The Fort Worth, Texas-based retailer also said merchandise margins improved as it marked down fewer items and sold less inventory at clearance prices.

Pier 1 also said that if its stock price continues to improve, it could terminate the conversion rights of those holding 9 percent of the company's convertible notes that were issued in the second quarter, lessening dilution for current stockholders. So far, $15 million of $61.2 million in bonds have been converted into about six million shares.

Pier 1 shares have risen 64 percent since the end of August. They closed Monday's regular session up 6 percent at $4.41.

The company also said it has scheduled an Oct. 13 analyst meeting to discuss its performance.

"Although it is still early in the quarter, we have seen nothing to indicate that recent sales and traffic trends will not continue," said President and CEO Alex Smith, in a statement. "As we head into November and December, we feel confident about our inventory level and our ability to manage it with significantly less markdowns than last year, resulting in continued improvements to merchandise margins on a year over year basis."