Struggling retailer Pier 1 Imports Inc. plans to close 45 stores—and as many as 145—as part of new "action plan" to cut costs and return the chain to profitability.
In the plan announced this week, Pier One said the 45 closures would involve stores where leases are expiring in the current fiscal year. The closure plan could involve as many as 15 percent of its 973 stores if it is unable to reduce rents at other locations.
The company did not specify which stores would close. Pier 1 has two stores in Indianapolis (6810 S. Emerson Ave. and 2902 W. 86th St.) and three in the suburbs (Plainfield, Carmel and Noblesville).
Part of Pier 1’s “action plan’’ includes generating cost savings and benefits of as much as $110 million in fiscal 2020 “by resetting its gross margin and cost structure.’’ The company also announced an interim chief financial officer from AlixPartners LLP, a company known for its turnaround and restructuring practice.
Pier 1 has been working on a comeback plan for months. In December, it ousted its then chief and ripped up the turnaround script he’d put in place the previous April. Cheryl Bachelder—who previously revamped Popeyes Louisiana Kitchen—has been leading the company since on an interim basis.
Bloomberg News reported last month that the retailer has been working with strategic advisers from AlixPartners and law firm Kirkland & Ellis LLP. The retailer named Deborah Rieger-Paganis, managing director at AlixPartners, as interim chief financial officer. One of her goals will be “instilling financial discipline,’’ she said in a statement. She replaces Nancy Walsh, who departed the company.
In the meantime, performance is further deteriorating. The retailer’s same-store sales fell 13.7 percent in the quarter that included Christmas—traditionally the retailer’s strongest period. The drop was deeper than previous quarters’ declines.
The Fort Worth, Texas-based retailer reported a fiscal fourth-quarter loss of $68.8 million, or 85 cents per share, after reporting a profit in the same period a year earlier.
The home decor company posted revenue of $412.5 million in the period.
For the year, the company reported a loss of $198.8 million, or $2.46 per share. Revenue was reported as $1.55 billion.
Shares in the company fell 25 percent Thursday, to 48 cents each. They are in danger of being taken off the New York Stock Exchange if they spend much more time below the $1 mark.