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Pier 1 Imports announces three-year growth plan, fiscal 2012 results

FORT WORTH, Texas - Pier 1 Imports, Inc. today announced a new three-year growth plan, updated financial goals, and fiscal 2012 financial results. Pier 1 Imports, Inc., Naples, Florida

The new board-approved growth plan, to begin in fiscal 2013, is designed to drive profitable top and bottom-line growth, expand market share and increase shareholder value as the company evolves into a multi-channel retailer, according to a company release. The plan includes a new e-commerce platform, store refurbishments, remodels, new openings and relocations, and infrastructure investments in technology, processeses and systems.

During fiscal 2012, the company made investments to improve its online presence and e-commerce functionality through the launch of site-to-store initiative "Pier 1 To-Go," and the establishment of agreements with several e-commerce technology partners. The company will launch "Pier 1 To-You" in late July, and is on track for the initial rollout of a new POS system in fall 2012, which will be followed by an all store rollout post-holiday.

"We are moving towards one million unique visitors per week to our Pier 1 Imports website," said Alex W. Smith, president and CEO. "Our teams are working diligently to ensure that we have a solid transition strategy to leverage this traffic when we introduce our e-commerce initiative, ‘Pier 1 To-You.' This launch will lay the foundation for the next phase of our evolution into a multi-channel retailer when we fully integrate our new POS system and have the ability to provide a truly seamless shopping experience for our valued customer."

In fiscal 2012, Pier 1 Imports refurbished 125 stores with an enhanced merchandise fixture package and new lighting upgrades, fully remodeled three stores, and added new merchandise fixtures throughout all of its stores.

During the next three years, the company will continue to deploy capital toward new store openings, store remodels, new merchandise fixtures, lighting upgrades, and other leasehold improvements.

In fiscal 2013, the company plans to fully remodel up to eight locations, refurbish approximately 100 existing stores with an enhanced merchandise fixture package and lighting upgrades, and integrate new merchandise fixture elements into all stores.

Pier 1's long-term growth plans also include new store openings, as well as strategic relocations in major markets where it says increased sales productivity and store profitability opportunities exist. The company opened 15 new stores in fiscal 2012 and plans to open approximately 20 new locations in fiscal 2013. The company remains on track to open approximately 80 to 100 new stores and close approximately 30 to 50 existing locations by the end of fiscal 2016.

In addition to investments in information technology related to e-commerce and POS, the company plans to replace legacy systems and enhance existing systems in areas including merchandise and SKU level planning, vendor portals, inventory and warehouse management.

"Our achievements in fiscal 2012 were the result of hard work and dedication throughout the entire organization," Smith said. "As we continue to transform the business and look ahead to new opportunities, we are committed to further improving sales productivity and delivering strong profitability. To that end, we have elevated our new three-year goals and now expect to achieve sales of $225 per retail square foot and an operating margin of at least 12% by fiscal 2015. Additionally, we believe the online opportunity is significant for our unique and proprietary merchandise. We expect to be able to leverage the success of our ‘Pier 1 To-Go' capability to drive site traffic and conversion when we launch ‘Pier 1 To-You' in late July. We continue to expect that online sales will contribute at least 10% of total revenues by fiscal year 2016."

The company today also reported financial results for the fourth quarter and fiscal year ended Feb. 25, 2012.

Total sales for the fourth quarter were $476.8 million, an 11.8% increase from $426.6 million in the year-ago quarter. Comparable store sales increased 10.3% during the fourth quarter compared to last year's comparable store sales increase of 8.9% for the same period. The sales increase for the quarter was primarily the result of increases in store traffic and average ticket.

For the fiscal year ended Feb. 25, 2012, income before income taxes was $164.1 million compared to $103.5 million last year. Total sales for the fiscal year increased 9.8% to $1.534 billion from $1.396 billion last fiscal year. Comparable store sales for the fiscal year increased 9.5% compared to a comparable store sales increase of 10.9% last fiscal year.

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