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PIR / Pier One: Turnaround or Liquidation?

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PIR / Pier One: Turnaround or Liquidation?

Pier One Imports maybe be set for another big turnaround... Or slide into Liquidation

Especially if those tariffs an cheap imports are eased

Pier 1 completed a 1-for-20 reverse stock split on June 20.

Book Value : $22.25 per share - $19.97 = $2.28 per share

Net loss of $81.7 million , or ($19.97) per share (Q1- 2020)

 

Shares O/S: 4.05M x $7.53 = MktCap: $30.5 Million

Financial Position

As of June 1, 2019, inventories totaled $327.2 million compared to $329.7 million a year ago. At quarter end, the Company had $30.5 million of cash and cash equivalents, $190.5 million outstanding under its senior secured term loan, $50 million of borrowings under its FILO tranche and $20 million of borrowings under its $350 million revolving credit facility.

PIR / Pier One ... all-data : vs-ShComp : 5-yr : 2-yr - Last: $7.53 (yr.L: $x.xx)

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: 5-yr :

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PIR-v-SHcomp : All vs-ShComp : 3yr : 10d

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With HK10: All-data : 5-yr : 1-yr : 10d :

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NEWS

 

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FIGHTING? LIQUIDATING?

Pier 1's market value has been almost completely wiped out over the past five and a half years, falling 97% since 2013.

pier-1-imports-0361.jpg

"It seemed like everything was on sale at Pier 1," Business Insider's Jessica Tyler wrote after visiting a Pier 1 location in Manhattan last month. "The issues raised about Pier 1's inability to keep up with trends, its overwhelming stores, and efforts to keep prices down were all clear when we visited the store. The brand has announced plans to rebrand the store and fix these issues, but it has a ways to go."

Pier 1 is a 'dumpster fire' and it's fighting for its survival (PIR ...

Jan 9, 2019 - Pier 1's market value has been almost completely wiped out over the past five ... Analysts say a combination of overwhelming store environments, ... Pier 1 is one of three stocks in UBS's 28-member hardline retail coverage ...
  • Analysts say the outlook is discouraging. Of the few surveyed by Bloomberg who cover the name, none rate the stock a "buy," two carry a "sell" rating, and four say "hold."
  • Analysts say a combination of overwhelming store environments, offerings that don't reflect the latest trends, and expensive sourcing and supply chain costs have brought the retailer to its knees.

So what happened?

Pier 1, based in Fort Worth, Texas, said last week that its chief information officer, Bhargav Shah, was terminated effective in November, a change the company did not mention in its December earnings report. Last month, Pier 1 named longtime board member Cheryl Batchelder as its interim CEO after Alisdair James stepped down following 19 months at the helm of the company.

In April, Pier 1 announced a three-year strategic plan to right the ship.

At the time, James said, "Pier 1 has a rich brand history and loyal customer base, a highly competitive e-Commerce platform and a team with the talent, experience and determination to succeed."

But analysts say a combination of overwhelming store environments, offerings that don't reflect the latest trends, and expensive sourcing and supply chain costs have brought the retailer to its knees.

"We are both sad and angry: sad that the company's associates and customers are now at significant risk and angry at a Board of Directors that, in our view, is culpable for allowing this crisis to develop," Budd Bugatch and Bobby Griffin, analysts at Raymond James, told clients after the company's most recent quarterly earnings report in December.

"F3Q19 was a 'dumpster fire,' which unfortunately has become all too common for Pier 1 quarterly earnings," they wrote.

Specifically, the analysts pointed to its 11.9% decline in total sales, 10.5% plunge in comparable sales, and a drop in operating income from $13.4 million last year to -$28.9 million this year.

Apr 22, 2019 - Analysts are raising the possibility of a Pier 1 liquidation ... Pier 1 stock has gained 57% in 2019, but has lost nearly 82% over the last year.

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Just before the 1-for-20 Reverse Split...

$0.63 x 20 = $12.60... Now closed at $7.53 -$0.40 (-$5.07, -40% since June 10th)

Flaming Stock- Pier 1 Imports, Inc. (NYSE:PIR) - Stocks Equity

Jun 10, 2019 - On Friday, Pier 1 Imports, Inc. (NYSE:PIR) reached at $0.63 price level during ... Analysts consider this stock active, since it switched Trading volume ... Important Technical Indicators Analysis Report and Volatility Measures:.

Liquidity:

The stock has a market cap of $51.80M with 82.22M shares outstanding ( / 20= 4.11M) , of which the float was 80.05M shares. Analysts consider this stock active, since it switched Trading volume reached 569,099 shares as compared to its average volume of 3.27M shares. The Average Daily Trading Volume (ADTV) demonstrates trading activity related to the liquidity of the security. When Ave Volume tends to increase, it shows enhanced liquidity.

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Pier 1 Imports, Inc. Reports First Quarter Fiscal 2020 Financial Results

Net loss of $81.7 million , or ($19.97) per share

Jun 26 2019

Provides Update on Fiscal 2020 Action Plan

FORT WORTH, Texas--(BUSINESS WIRE)--Jun. 26, 2019-- Pier 1 Imports, Inc. (NYSE:PIR) today reported financial results for the first quarter ended June 1, 2019.

First Quarter Fiscal 2020 Financial Summary

  • Company comparable sales decreased 13.5% compared to the first quarter of fiscal 2019;
  • Net sales decreased 15.5% to $314.3 million compared to the first quarter of fiscal 2019;
  • Net loss of $81.7 million, or ($19.97) per share, reflecting the Company’s recently effected 1-for-20 reverse stock split on June 20, 2019;
  • Inventory of $327.2 million, down approximately 1% year-over-year; and
  • Cash and cash equivalents of $30.5 million at quarter end, $50 million of borrowings under the Company’s FILO tranche and $20 million of borrowings under its $350 million revolving credit facility.

Cheryl Bachelder, Interim CEO, stated, “Our teams are laser focused on the initiatives under our fiscal 2020 action plan, which is designed to reset our operating model and rebuild our business for the future. We believe Pier 1 has strong brand equity and a loyal customer who will return for the right style stories in our assortment. As we expected, our sales and margins remained under pressure in the first quarter and we anticipate this will continue through the second quarter. This reflects our decision to take aggressive clearance actions to move through lower-priced, lower-margin goods and ensure we provide our customers with a strong, on-brand style statement for fall.

“We have chosen to prioritize our comp sales recovery with the implementation of new merchandising and marketing initiatives supported by substantive cost cutting actions. Importantly, we remain on track to achieve the previously outlined benefits of $100-$110 million this year and now expect the substantial majority of those benefits to be realized through cost reductions. The expense savings we plan to realize in the second half of fiscal 2020 are expected to be absorbed by reduced gross margins rather than driving the full year net income and EBITDA recapture we previously outlined.”

Ms. Bachelder concluded, “As we implement our fiscal 2020 action plan, we are incorporating our learnings and addressing business trends in real-time. We are committed to restoring the health and promise of the Pier 1 brand and believe our initiatives and liquidity will give us sufficient runway to achieve our fiscal 2020 goals.”

First Quarter Fiscal 2020 Results of Operations

Net sales for the first quarter of fiscal 2020 decreased 15.5% to $314.3 million, compared to $371.9 million for first quarter of fiscal 2019. Company comparable sales decreased 13.5% compared to the year ago period. The decline in company comparable sales is a result of lower average customer spend, which is primarily attributable to changes in the Company’s merchandise mix, as well as decreased store traffic. The Company operated 967 stores at the end of the first quarter, a decrease of 30 from the first quarter of fiscal 2019.

Gross profit for the first quarter of fiscal 2020 totaled $78.8 million , or 25.1% of net sales, compared to $120.1 million , or 32.3% of net sales, for the first quarter of fiscal 2019. The year-over-year decline in gross margin rate reflects lower merchandise margin, as well as 270 basis points of deleverage on occupancy costs. The year-over-year decline in merchandise margin rate is primarily attributable to increased promotional and clearance activity.

> More: https://investors.pier1.com/news-releases/news-release-details/pier-1-imports-inc-reports-first-quarter-fiscal-2020-financial

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Conference call - announced results after close, June 26th

PIR ... 10d : Last: $7.53 - 0.40

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Q1 2020 Pier 1 Imports, Inc. Earnings Conference Call

> https://investors.pier1.com/events/event-details/q1-2020-pier-1-imports-inc-earnings-conference-call

> https://edge.media-server.com/mmc/p/9pm4j7z3

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Cheryl Bachelder , Interim CEO

We believe we have "strong brand identity, and loyal customers, ...who will return"

"weak in the first half (as merchandize is liquidated)... stronger in the second half"

"As in any Turnaround, we are learning"

"we are taking AGGRESSIVE CLEARANCE ACTIONS... Cost-cutting actions"

"25% Tariffs are full-reflected in..." projections for the second half

"Market spending is down... and will be better-targeted"

CAPITAL: "we have sufficient 'runway' to achieve the turnaround we have described"

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AFTER My Review...

In Book Value, I am MUCH less interested !

Book Value : $22.25 per share - $19.97 = $2.28 per share

Net loss of $81.7 million , or ($19.97) per share (Q1- 2020)

(my comment to an investor friend was):

+ I have gone off PIR after studying it more closely.  Will find another idea

+ The PIR Book Value is  down to $2, and losing $20 in the last quarter!  Will they survive?  Maybe better ideas out there

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