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Business

Pier 1 will close up to 450 stores, cut corporate jobs

By
Noah Manskar
Published Jan. 7, 2020, 9:06 a.m. ET

Pier 1 Imports plans to close almost half its stores and slash corporate jobs as it grapples with growing losses and weighs bankruptcy.

The Texas-based furniture retailer said it will shutter up to 450 of its 936 stores and some distribution centers “to better align its business with the current operating environment.” The company will also scale back its corporate workforce as part of its cost-cutting efforts.

“Although decisions that impact our associates are never easy, reducing the number of our brick-and-mortar locations is a necessary business decision,” Robert Riesbeck, Pier 1’s CEO and chief financial officer, said in a Monday statement.

Pier 1 has drafted a plan for bankruptcy that would shrink the company to one with about $900 million in yearly sales, according to news reports. The company admitted in a Monday regulatory filing that there are concerns about its ability to cover financial obligations over the next year.

Pier 1 did not immediately give a timeline for the store closures, though it said an outside liquidator will help mange them. The company also did not specify how many corporate jobs will be cut, but Bloomberg News reported that about 300 employees will be affected.

The store closures were announced as Pier 1 revealed bleak quarterly financial numbers Monday. The company recorded $358.4 million in net sales for the quarter ending Nov. 30, down 13.3 percent from the comparable period in 2018, while its net loss grew from the prior year to $59 million.

Pier 1 shares were down nearly 17 percent at $5.18 when trading was halted Monday afternoon.

Pier 1 is just the latest company to scale back amid continued pressure from giant rivals such as Amazon. New Jersey-based craft chain AC Moore announced plans to close all its stores in November, and bankrupt luxury fashion retailer Barneys New York has struggled to liquidate stock from its storied Madison Avenue flagship.