Stein Mart’s Q1 earnings double; raises outlook
Off-price retailer Stein Mart raised the first half of its forecast as improvements in store inventory contributed to its earnings.
Net income was $7.3 million, or $0.16 per diluted share, for the quarter ended May 5, compared to $3.7 million or $0.08 per share in 2017. Adjusted earnings was $18.4 million.
Total sales fell 3.2% to $326.7 million. The company credited to the impact of six stores closed last year and four stores closed during the first quarter of 2018.
Same-store sales fell 0.7%, which was not as bad as analysts had expected. Ecommerce sales were up 85% over last year’s first quarter, and represented 5% of total revenue.
“Comparative sales trends showed considerable improvement for the quarter and operating income exceeded our expectations, said Hunt Hawkins, CEO. “Continuing strong inventory productivity drove a significantly higher gross profit rate. The higher gross profit and our below-plan expenses more than offset the impact of somewhat lower sales.”
The off-pricer raised its guidance for the first half. It now expects first-half operating income to be in excess of $10 million instead of the $8 million it previously forecast.
Also, while it is early in the second quarter, we are pleased with May’s positive comparable sales trend which reflects the return of seasonal temperatures,” said Hunt.
Stein Mart had 289 stores at the end of the quarter, compared to 292 last year. It expects to close a total of seven stores and open two new stores in 2018.
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