The company issued guidance for both the fiscal third quarter and the full year. Pier 1 expects EPS in the range of $0.10 to $0.14 and comparable sales growth in the low-single digits for the fiscal third quarter, compared to consensus estimates of $0.23 in EPS on $505.33 million in revenue. For fiscal 2016, the company expects EPS in the range of $0.56 to $0.64 and low single-digit company comparable sales growth for the fiscal 2016 full year. The consensus estimates are EPS of $0.83 and $1.93 billion in revenue for the full year.
During the second quarter of fiscal 2016, the company closed 16 stores and opened six — four of which were relocations — ending the period with 1,053 stores. Pier 1 expects to end fiscal 2016 with approximately 30 net store closures.
The company repurchased roughly 2.7 million shares of common stock under its April 2014 share repurchase program for $32.4 million in the fiscal second quarter.
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Alex W. Smith, president and CEO of Pier 1, commented on earnings:
We are disappointed with our second quarter sales and earnings results. Top line growth was below our expectations, with Company comparable sales up 3.8% on a constant currency basis. During the period, our margins were impacted by increased promotional and clearance activity, as well as inventory related issues within our distribution center network. We’ve made progress toward bringing inventories in line and remain on track to end fiscal 2016 with year-over-year levels down meaningfully. However, operating with elevated inventories has been a challenge. As such, and considering our second quarter sales trend, we are tempering our expectations for the balance of the year.
Shares of Pier 1 were down 16.8% at $7.21 late Friday morning. The stock has a consensus analyst price target of $13.54 and a 52-week trading range of $6.84 to $17.52.
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