Investing.com -- Shares in Pier 1 Imports Inc (NYSE:PIR) fell mildly in after-hours trading as the struggling home furnishing retailer lowered its forward guidance for Fiscal Year 2017 on Wednesday, after its profits and revenues fell sharply during the previous quarter.
It represented the latest hit for the flagging decorative accessory company, which has had difficulty making the transition from a brick-and-mortar to e-commerce store over the last several years. For Pier One's fourth quarter of Fiscal Year 2016, the Fort Worth, Texas-based company saw its earnings nearly slashed in half to $18.7 million or 0.23 per share from $33.1 million or 0.37 over the same period a year earlier. At the same time, Pier One's sales tumbled 1.4% to $542.3 million amid heightened currency headwinds from a weaker Canadian dollar. Pier One's comparative store sales, including e-commerce, fell by 0.6% over the three-month period, as brick-and-mortar revenues continue to slide while customers increasingly head online. Last quarter, e-commerce sales comprised 15% of Pier One's total revenues, up from 13% during the same quarter in 2015.
Overall, Pier One reported net income of $39.6 million, or 0.46 per share in the 2016 Fiscal Year, compared to $75.2 million, or 0.82 per share a year earlier. On a positive note, Pier One reduced a sizable inventory glut by 15% last year, which could help improve the efficiency of its distribution network.
"Although fiscal 2016 was a challenging year, we made solid progress toward stabilizing top line trends, cutting costs and reducing inventory levels," Pier One CEO Alex Smith said in a statement. "We also delivered another year of strong e-Commerce sales, which increased 45% on top of 193% growth last year."
Moving forward, Pier One expects to report per share earnings of 0.42 to 0.50 in Fiscal Year 2017, below analysts' forecasts of 0.56.
"The significant strides we made on the inventory front helped us put many of the issues in our distribution centers behind us; we’re now starting to see improved efficiency across the network, which will help us strengthen merchandise margin," Smith added.
Shares in Pier One fell 0.17 or 2.32% to 7.15 in after-hours trading.