Pier 1 Imports Plans To Close About 45 Stores In 2020

(RTTNews) - Pier 1 Imports Inc. (PIR) said that it is considering closing up to 45 locations in fiscal 2020 as leases expire. The store closure number could increase to up to 15% of stores if the company is unable to achieve performance goals, sales targets, and reductions in occupancy and other costs.

Pier 1 Imports also said that Deborah Rieger-Paganis will assume the role of Interim Chief Financial Officer, effective immediately. Her appointment follows Nancy Walsh's departure from the company.

The company said it is implementing an action plan designed to drive benefits in fiscal 2020 of approximately $100 million-$110 million by resetting its gross margin and cost structure. Approximately one-third of the benefits are expected to be realized in gross margin, with the remaining two-thirds coming from cost reduction.

After reinvesting in the business, the company believes it will be positioned to recapture approximately $30 million-$40 million of net income and $45 million-$55 million of EBITDA in fiscal year 2020.

As part of the $100-$110 million of benefits, the company has identified approximately $70-$80 million of selling, general and administrative savings opportunity for fiscal 2020, the majority of which is expected to be realized in the second half of the year. This SG&A savings opportunity for fiscal 2020 reflects an expected annual run-rate of approximately $95-$105 million.