Pier 1 Taps TJX Executive Alex Smith to Be New CEO
Struggling home decor retailer Pier 1 Imports on Tuesday said Alex Smith, who was most recently senior executive vice president with TJX, would become chief executive and president on Feb. 19
As CEO, Smith succeeds Marvin Girouard, whose planned retirement after nearly 32 years with the company had been previously announced.
The management change at Pier 1 comes after seven consecutive quarterly losses. They company has suffered from a slowing housing market and increased competition from specialty retailers and discount retailers like Target.
To try to attract more customers, Pier 1, known for its wicker furniture and ethnic decorations, has cut prices, updated its merchandise with more modern styles, and mailed out millions of catalogs, but sales remain sluggish.
"We are very encouraged with Pier 1's decision to hire a new chief executive from outside the company and one with prior experience in fashion retail," UBS retail analyst Brian Nagel wrote in a note.
Nagel said he believed that trends at the home decor retailer remained weak and an outside perspective could help the company regain its strategic footing.
Earlier this month, Pier 1 reported a decline of more than 10% in December sales at stores open at least a year, its 11th consecutive month of lower same-store sales.
In May, Pier 1 said it would consider strategic options including asset sales, and its stock jumped in November following a report that Danish retail magnate Jakup Jacobsen was preparing to make a bid to take full control of the retailer.
With a new CEO in place, Lehman Brothers analyst Alan Rifkin said the likelihood of a private equity transaction has diminished.
"While Pier 1's announcement today of a replacement CEO eliminates uncertainty surrounding the company's management, many fundamental issues remain and will continue to present challenges for the new CEO," he wrote in a note.
Retiring CEO Girouard had also held the title of chairman, and Pier 1 said current board member Tom Thomas would become nonexecutive chairman next month.
Smith, 54, has worked in retail more than 30 years and has proven that he can run large divisions of a global chain while at TJX, Thomas said in a company statement. TJX operates the T.J. Maxx and Marshalls chains.