Stein Mart Weathers Rough Q1

Stein Mart weathered a rough first quarter, but pointed to initiatives rolling out in the second half that it feels will build sales growth and store traffic.

The company posted net income of $4 million, or eight cents per diluted share, versus $7.3 million, or 16 cents per diluted share, in the 2018 period.

Comparable sales decreased 1.7% in the quarter year over year, due to lower store traffic and average unit retail, partially offset by higher units per transaction. Digital sales increased 14% versus the year-earlier period.

Net sales were $314.2 million versus $326.6 million for the year-prior quarter. The comparable sales slide and the operation of fewer stores drove the decline, the company added. Operating income was $6.5 million compared to $9.9 million in the year-before quarter.

Stein Mart noted that it is rolling out second half sales initiatives that include the introduction of two new product lines, kids and fine jewelry, launched to increase transactions and appeal to a broader customer base. It also is introducing buy online, pick up in store to drive sales floor traffic and deliver incremental sales, and implementing a marketing campaign management tool that will analyze customer data to create personalized email and direct mail messaging.

Stein Mart is also teaming with Amazon by installing Amazon Hub Lockers in nearly 200 of its stores across 28 states. Amazon Hub Lockers are secure, self-service kiosks that provide customers of the online retailer an alternative delivery option to pick up and return their Amazon packages.

 Hunt Hawkins, Stein Mart CEO, said, “With a late start to spring in the South and West, February was a challenging month with negative mid-single digit comp sales. Our comp sales for the combined March and April period dramatically improved. Comp sales in the first quarter also benefited by approximately 150 basis points from the shift of a 12-Hour Sale event from the second quarter to the first. With the event shift and slow selling thus far in May, we expect headwinds to impact the second quarter. Looking forward, with our 2019 sales-driving initiatives rolling out this fall, we believe that our comp sales trends and results will improve in the second half.”