Hurricanes Can't Stop Stein Mart
By Staff -- Home Textiles Today, 11/28/2005
Jacksonville, Fla. —Despite losing almost $6 million in sales to a pair of hurricanes that damaged and shut many of its stores, Stein Mart Inc. parlayed strict inventory controls and stronger margins into a $1.4 million third quarter profit, recovering from a year-before loss of $2 million.
Sales increased 1.8 percent, to $336.5 million from $330.4 million, and would have climbed higher but for store closings and business disrupted by Hurricanes Katrina and Wilma. The retailer estimated about $5.7 million in sales was lost due to stores that were closed for at least one day. Held in check by storms, same-store sales edged up 0.4 percent.
Providing a lift to the bottom line, average gross margin widened 1.6 percentage points, to 24.7 percent from 23.1 percent helped by improved mark-up and fewer markdowns, the company said. Merchandise stockpiles were cut 2.9 percent from year-ago levels, to $313.3 million from $322.7 million, yielding a savings of $9.3 million.
“We are pleased to have produced a profit in the third quarter, despite eight weeks of punishing hurricane activity that preoccupied communities and customers,” said Michael Fisher, CEO.
Storms had a major impact on business, the retailer said, closing stores in at least seven states over the course of eight weeks. “Several areas were threatened and/or struck more than once, and while only a few Stein Mart stores were structurally damaged, issues with power, infrastructure and evacuated associates curtailed business significantly,” the retailer said.
| Qtr. 10/29 (x000) | 2005 | 2004 | % change |
| Sales | $336,537 | $330,432 | 1.8 |
| Oper. income (EBIT) | (2,006) | (6,680) | -- |
| Net income | 1,396a | (2,003)a | -- |
| Per share (diluted) | 0.03 | (0.05) | -- |
| Average gross margin | 24.7% | 23.1% | -- |
| SG&A expenses | 25.3% | 25.1% | -- |
| Nine months | |||
| Sales | 1,054,256 | 1,014,664 | 3.9 |
| Oper. income (EBIT) | 35,470 | 14,044 | 152.6 |
| Net income | 29,829b | 15,136b | 97.1 |
| Per share (diluted) | 0.67 | 0.36 | 86.1 |
| Average gross margin | 27.6% | 25.5% | -- |
| SG&A expenses | 24.2% | 24.1% | -- |
| (loss) a-Third quarter results include $3.7 million in miscellaneous income, up 13.8 percent from $3.3 million during the same period a year ago; and an income-tax benefit of $856,000, compared with a year-before tax payment of $1.2 million. b-Nine month results include $11.3 million in miscellaneous income, compared with $10.5 million last year; and an income tax benefit of $18.3 million, compared with a year-before tax benefit of $9.4 million. The prior-year nine months included an after-tax $145,000 loss from discontinued operations. |
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