Pier 1 2012 Annual Report Download - page 31

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Net sales during fiscal 2011 were $1,396.5 million, an increase of $105.6 million or 8.2%, from $1,290.9
million for the prior fiscal year. The increase in sales for the fiscal year was comprised of the following
components (in thousands):
Net Sales
Net sales for fiscal 2010 $ 1,290,852
Incremental sales growth (decline) from:
New stores 2,969
Comparable stores 136,420
Closed stores and other (33,771)
Net sales for fiscal 2011 $ 1,396,470
The total sales growth for fiscal 2011 was primarily the result of an increase in traffic, conversion rate,
and average ticket compared to prior year. As of February 26, 2011, the Company operated 1,046 stores in the
United States and Canada, compared to 1,054 stores at the end of fiscal 2010. The Company’s net sales from
Canadian stores were subject to fluctuation in currency conversion rates. These fluctuations contributed to a 70
basis points increase in both the net sales and comparable store calculations in fiscal 2011 compared to fiscal
2010.
A summary reconciliation of the Company’s stores open at the beginning of fiscal 2011, 2010 and 2009
to the number open at the end of each period follows (openings and closings include relocated stores):
United States Canada Total
Open at March 1, 2008 1,034 83 1,117
Openings 1 - 1
Closings (24) (2) (26)
Open at February 28, 2009 1,011 81 1,092
Openings - - -
Closings (38) - (38)
Open at February 27, 2010 (1) 973 81 1,054
Openings 3 - 3
Closings (9) (2) (11)
Open at February 26, 2011 (2) 967 79 1,046
(1) During the third quarter of fiscal 2010, the Company ended its relationship with Sears Roebuck de Puerto Rico, Inc. and
closed all seven “store within a store” locations in Puerto Rico. These locations are excluded from the table above.
(2) The Company supplies merchandise and licenses the Pier 1 Imports name to Grupo Sanborns, S.A. de C.V. which sells Pier 1
Imports merchandise primarily in a “store within a store” format. At the end of fiscal 2011, there were 38 of these locations in
Mexico and one in El Salvador. These locations are excluded from the table above.
Gross Profit
Gross profit, which is calculated by deducting store occupancy costs from merchandise margin dollars,
was 39.8% expressed as a percentage of sales in fiscal 2011, compared to 34.1% in fiscal 2010. Merchandise
margins were 58.6% as a percentage of sales, an increase of 380 basis points over 54.8% in fiscal 2010.
Improvements in merchandise margin over the previous year were primarily the result of significantly lower
markdowns resulting from strong input margins and well-managed inventory levels throughout fiscal 2011.
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