Third-quarter earnings fell 39% from a year ago at
and the furniture retailer predicted lower same-store sales and a disappointing profit in the current period.
Pier 1 earned $19.5 million, or 22 cents a share, in the three months ended Nov. 27, compared with earnings of $32.2 million, or 35 cents a share, last year. Overall sales rose 1.1% from a year ago to $487.7 million in the quarter, while same-store sales fell 6.3%.
Analysts surveyed by Thomson First Call had been forecasting earnings of 22 cents a share on sales of $490.5 million in the most recent quarter. The company previewed the results when it announced November comps skidded 9.1% on Dec. 2.
For the current quarter, Pier 1 now expects to earn 43 cents to 52 cents a share, down from its old estimate of 52 cents to 63 cents a share, on same-store sales that are down by a percentage in the mid-single digits. The Wall Street consensus earnings estimate for the quarter is 52 cents a share.
Pier 1's shares have fallen 16% this year, closing Monday at $17.86. The decline would be worse were it not for the support of Warren Buffett, whose
reported a 9% stake in the company in August. The legendary investor evidently spies a turnaround play in the struggling retailer, with the company's annual earnings expected to jump by 50% over the next two years, going by the Thomson First Call consensus.
Pier 1's fourth-quarter forecast means the company now expects earnings of 90 cents to 99 cents a share in the year ending in February 2005. Wall Street expects Pier 1 to earn 98 cents in that fiscal year, $1.16 a share in the year after that, and $1.50 in the year ending February 2007.