Pier 1 Imports September sales, traffic down

ATLANTA (Reuters) - Home furnishings retailer Pier 1 Imports Inc (PIR.N) said on Thursday that its comparable-store sales fell 11.7 percent in September as traffic declined 8 percent.

The company also said that should traffic levels not improve from levels of recent weeks, it will not meet current consensus earnings expectations for the back half.

Analysts expect profit of 1 cent a share for the third quarter and 28 cents a share for the fourth period, according to Reuters Estimates.

Pier 1's shares were down 4 cents at $2.06 in morning New York Stock Exchange trading. The stock hit a year low of $2.01 on Wednesday and has fallen 59 percent this year.

"The numbers were awful, and the go-forward assumptions don't give you a warm fuzzy feeling," said Brian Postol, an analyst with Jesup & Lamont. "This turnaround story is not panning out the way that some people felt it would."

In September, Pier 1 had reported a wider-than-expected second-quarter loss on deep markdowns and withdrew its full-year outlook. Home-goods retailers have taken a hit as consumers curb discretionary spending in the weak U.S. economy.

"Clearly, growing consumer concerns and the effects of extreme weather took a toll on our September sales results," Pier 1's chief executive said in a statement. Still, he added that despite the traffic drop, sales conversion rates were strong.

Pier 1 said it had more than $191 million in cash and short-term investments and $117 million available on its line of credit as of the end of August.

"Overall, while comp trends are likely to remain quite challenging and (earnings per share) losses look to continue indefinitely, PIR is in a still quite solid liquidity position," said Sanford Bernstein analyst Colin McGranahan in a research note on Thursday.

(Reporting by Karen Jacobs; Editing by Brian Moss)