Pier 1 Imports Q3 Profit Misses Estimates, But Revenues Top; Cuts FY14 EPS View

(RTTNews) - Pier 1 Imports, Inc. (PIR), a specialty retailer of decorative home furnishings and gifts, Thursday reported a rise in third-quarter profit, driven by about 10 percent growth in sales. Earnings per share missed analysts' expectations, while revenues came above view. The board also declared a higher quarterly dividend.

The company issued guidance for the fourth quarter, but cut its earnings per share outlook for fiscal 2014 once again. While reporting its second-quarter results, Pier 1 had trimmed its forecast for fiscal 2014 earnings per share.

For the 13 weeks ended November 30, 2013, the firm posted net income of $26.76 million or $0.26 per share, up from $23.69 million or $0.22 per share in the previous year. For the third quarter of last year, the company had posted adjusted earnings of $0.25 per share.

On average, 13 analysts polled by Thomson Reuters expected the company to report earnings of $0.28 per share for the third-quarter. Analysts' estimates typically exclude special items.

Net sales for the quarter grew 9.6 percent to $465.46 million from $424.53 million in the year-ago quarter, and came above 11 analysts' estimate of $462.14 million.

Comparable store sales increased 6.9 percent, compared to 7.9 percent increase in the prior-year quarter. Comparable store sales results for the period were mainly attributable to increases in conversion rate and higher average ticket, the company said.

Looking ahead to the fourth quarter, on a comparable 13-week basis, the firm expects earnings per share to be in the range of $0.60 to $0.66, representing year-over-year growth of 9 to 20 percent.

Total sales growth is anticipated to be in the high single-digit range. Comparable store sales growth is expected to be in the mid single-digit range.

Analysts expect the company to report earnings of $0.62 per share, on revenues of $569.37 million for the fourth-quarter.

For fiscal 2014, on a comparable 52-week basis, the company now expects earnings per share to be in the range of $1.21 to $1.27, down from the prior outlook of $1.23 to $1.29 per share.

The company still expects annual total sales growth to be in the high single-digit range, with comparable store sales growth to be in the mid single-digit range.

Street currently is looking for fiscal year 2014 earnings of $1.25 per share, on annual revenues of $1.82 billion.

The company said its fiscal 2014 fourth quarter and fiscal year will include 13 weeks and 52 weeks of operating results, respectively. This compares to the fourth quarter and full year of fiscal 2013, which included 14 weeks and 53 weeks, respectively.

As previously indicated, it estimates the 53rd week of fiscal 2013 contributed $29 million to net sales and approximately $0.03 to earnings per share.

The board has also declared a quarterly cash dividend of $0.06 per share, up 20 percent from the previous quarterly cash dividend, to shareholders of record on January 22, 2014, payable on February 5. Pier 1 shares closed Wednesday's regular trading session at $20.73 on the NYSE.