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Pier 1 Imports, Inc. Reports Fiscal 2013 Third Quarter Financial Results

Stocks in this article: PIR

Management’s expectations and assumptions regarding future results are subject to risks, uncertainties and other factors that could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statements included in this press release. Any forward-looking projections or statements should be considered in conjunction with the cautionary statements and risks contained in the Company’s Annual Report on Form 10-K. Refer to the Company’s most recent SEC filings for any updates concerning these and other risks and uncertainties that may affect the Company’s operations and performance. The Company assumes no obligation to update or revise its forward-looking statements even if experience or future changes make it clear that any projected results expressed or implied will not be realized.

Pier 1 Imports, Inc. is the original global importer of imported decorative home furnishings and gifts. Information about the Company is available on www.pier1.com.

                           

Pier 1 Imports, Inc.

 
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands except per share amounts)
(unaudited)
 
Three Months Ended
November 24, % of November 26, % of
2012 Sales 2011 Sales
 
Net sales $ 424,527 100.0 % $ 382,699 100.0 %
 
Cost of sales   238,268   56.1 %   217,209   56.8 %
 
Gross Profit 186,259 43.9 % 165,490 43.2 %
 
Selling, general and administrative expenses 139,244 32.8 % 127,514 33.3 %
Depreciation and amortization   8,192   2.0 %   5,104   1.3 %
 
Operating income 38,823 9.1 % 32,872 8.6 %
 
Nonoperating (income) and expenses:
Interest and investment income and other (298 ) (3,238 )
Interest expense   664       739    
  366   0.0 %   (2,499 ) -0.6 %
 
Income before income taxes 38,457 9.1 % 35,371 9.2 %
Income tax provision   14,772   3.5 %   12,383   3.2 %
 
Net income $ 23,685   5.6 % $ 22,988   6.0 %
 
Earnings per share:
Basic $ 0.22   $ 0.21  
 
Diluted $ 0.22   $ 0.21  
 
Dividends declared per share: $ 0.04   $ 0.00  
 
Average shares outstanding during period:
Basic   105,419     108,713  
 
Diluted   107,308     110,306  
 
 

                             

Pier 1 Imports, Inc.

 
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands except per share amounts)
(unaudited)
 
Nine Months Ended
November 24, % of November 26, % of
2012 Sales 2011 Sales
 
Net sales $ 1,153,260 100.0 % $ 1,056,854 100.0 %
 
Cost of sales   665,179   57.7 %   622,775   58.9 %
 
Gross Profit 488,081 42.3 % 434,079 41.1 %
 
Selling, general and administrative expenses 367,596 31.9 % 342,416 32.4 %
Depreciation and amortization   21,936   1.9 %   15,171   1.5 %
 
Operating income 98,549 8.5 % 76,492 7.2 %
 
Nonoperating (income) and expenses:
Interest and investment income and other (2,169 ) (8,441 )
Interest (income) expense   (629 )     2,279    
  (2,798 ) -0.3 %   (6,162 ) -0.6 %
 
Income before income taxes 101,347 8.8 % 82,654 7.8 %
Income tax provision   33,607   2.9 %   28,929   2.7 %
 
Net income $ 67,740   5.9 % $ 53,725   5.1 %
 
Earnings per share:
Basic $ 0.64   $ 0.47  
 
Diluted $ 0.62   $ 0.47  
 
Dividends declared per share: $ 0.12   $ 0.00  
 
Average shares outstanding during period:
Basic   106,601     113,767  
 
Diluted   108,502     115,490  
 
 

                 

Pier 1 Imports, Inc.

 
CONSOLIDATED BALANCE SHEETS
(in thousands except share amounts)
(unaudited)
 
November 24, February 25, November 26,
2012 2012 2011
ASSETS
 
Current assets:

Cash and cash equivalents, including temporary investments of $97,064, $248,624 and $136,765, respectively

$ 120,788 $ 287,868 $ 179,296
Accounts receivable, net 34,979 16,282 26,561
Inventories 417,547 322,482 367,876
Prepaid expenses and other current assets   25,417     23,682     21,659  
Total current assets 598,731 650,314 595,392
 
Properties, net 136,736 103,640 87,029
Other noncurrent assets   71,963     69,409     30,405  
$ 807,430   $ 823,363   $ 712,826  
 
LIABILITIES AND SHAREHOLDERS' EQUITY
 
Current liabilities:
Accounts payable $ 73,923 $ 63,827 $ 68,437
Gift cards and other deferred revenue 47,800 53,123 58,369
Accrued income taxes payable 16,689 16,759 11,731
Other accrued liabilities   114,628     111,679     115,342  
Total current liabilities 253,040 245,388 253,879
 
Long-term debt 9,500 9,500 9,500
Other noncurrent liabilities 60,440 74,832 70,666
 
Shareholders' equity:

Common stock, $0.001 par, 500,000,000 shares authorized, 125,232,000 issued

125 125 125
Paid-in capital 231,234 231,919 230,524
Retained earnings 517,732 462,751 347,538
Cumulative other comprehensive loss (3,214 ) (4,473 ) (2,174 )

Less -- 18,861,000, 15,512,000 and 15,574,000 common shares in treasury, at cost, respectively

  (261,427 )   (196,679 )   (197,232 )
  484,450     493,643     378,781  
$ 807,430   $ 823,363   $ 712,826  
 
 

     

Pier 1 Imports, Inc.

                 
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
 
Nine Months Ended
November 24, November 26,
2012 2011
 
Cash flow from operating activities:
Net income $ 67,740 $ 53,725
Adjustments to reconcile to net cash (used in) provided by
operating activities:
Depreciation and amortization 27,537 23,078
Stock-based compensation expense 9,141 4,780
Deferred compensation 4,767 4,342
Amortization of credit card deferred revenue (2,914 ) (15,625 )
Amortization of deferred gains (3,284 ) (9,794 )
Change in reserve for uncertain tax positions (7,266 ) 152
Other (1,495 ) (99 )
Changes in cash from:
Inventories

 

(95,065 ) (56,106 )
Proprietary credit card receivables (7,653 ) (1,646 )
Prepaid expenses and other assets (16,424 ) (15,031 )
Accounts payable and accrued expenses 8,401 12,668
Accrued income taxes payable, net of payments   (3,716 )   11,499  
Net cash (used in) provided by operating activities   (20,231 )   11,943  
 
Cash flow from investing activities:
Capital expenditures (57,741 ) (40,359 )
Proceeds from disposition of properties 165 1,341
Proceeds from sale of restricted investments 1,238 423
Purchase of restricted investments   (3,178 )   (1,240 )
Net cash used in investing activities   (59,516 )   (39,835 )
 
Cash flow from financing activities:
Cash dividends (12,759 ) -
Purchases of treasury stock (89,747 ) (100,000 )

Proceeds from stock options exercised, stock purchase plan and other, net

15,173 8,814
Debt issuance costs   -     (3,097 )
Net cash used in financing activities   (87,333 )   (94,283 )
 
Change in cash and cash equivalents (167,080 ) (122,175 )
 
Cash and cash equivalents at beginning of period   287,868     301,471  
Cash and cash equivalents at end of period $ 120,788   $ 179,296  




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