Pier 1 2009 Annual Report Download - page 6
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5MAY200911382902 5MAY200911383733
The challenging economic environment might have had a more catastrophic impact had we not
improved our balance sheet and liquidity position. The liquidity generated from the sale of our
corporate headquarters as well as the reduction of our investment in inventory provided us the
wherewithal to withstand the unanticipated sales declines experienced in the third and fourth
quarters. Subsequent to the end of fiscal 2009, one of our foreign subsidiaries purchased
$79 million dollars of our unsecured convertible notes. The purchase was made at a significant
discount using only $27 million of cash to reduce our consolidated outstanding debt by
$79 million. The opportunity to execute the repurchase of the convertible notes significantly
strengthened our financial position. In our proxy statement that is included with this letter, we
are asking for your approval on three proposed amendments to our certificate of incorporation
that will provide our Board continued flexibility in guiding our company and protecting our
shareholders’ interests.
Our company has transformed over the last two years. Without the clear strategies that resulted
in the improvements to our merchandise and stores and the significant reductions in our costs;
and without having had the ability to take the steps we took to improve liquidity and strengthen
our balance sheet, this recession could well have affected our company more dramatically than it
has. Rest assured, our Board, our management team, and our associates continue to work
diligently every day to ensure the success of our company.
As we look down the road on our journey, it is difficult to predict what the economy holds in
store for fiscal 2010. Clarity on our mission and our strategy has served us well and we remain
committed to our course of action in executing our eight business priorities. We firmly believe
that some things are worth fighting for and a successful Pier 1 Imports is one of them. We know,
with the continued support of our suppliers, vendors, customers, and our talented and
enthusiastic associates across the entire organization, that together we will restore shareholder
value and will return the luster to our well-loved company.
Alexander W. Smith Tom M. Thomas
President and Chief Executive Officer Chairman, Board of Directors