Stein Mart, Inc. Reports 2012 Results, Completion of Restatement and Plans for 2013

Stein Mart, Inc. Reports 2012 Results, Completion of Restatement and Plans for
2013

  oFiscal year diluted earnings per share of $0.57 compared to $0.44
    (Restated) in 2011.
  oFourth quarter diluted earnings per share of $0.30 compared to $0.13
    (Restated) in 2011.
  oComparable store sales for the year increased 2.7 percent and for the
    quarter increased 6.0 compared to 2011.
  oEnding cash of $67.2 million after paying a dividend of $43.8 million.
  oRegained compliance with NASDAQ rules with today's SEC filings.

JACKSONVILLE, Fla., May 3, 2013 (GLOBE NEWSWIRE) -- Stein Mart, Inc.
(Nasdaq:SMRT) today announced financial results for the 2012 fiscal year and
its second through fourth quarters, as well as the restated results for all
2011 periods and the first quarter of 2012 (see "Restated Results" for further
information). All 2011 amounts in this release have been restated.

Overview of Results

Net income for the year ended February 2, 2013 was $25.0 million or $0.57 per
diluted share compared to net income of $19.9 million or $0.44 per diluted
share in 2011. EBITDA for the year ended February 2, 2013 was $60.1 million
compared to $51.0 million in 2011 (see Note 1 in the attached materials).
Fiscal 2012 results include the following:

  *$4.0 million of legal and accounting fees incurred in the fourth quarter
    related to the financial restatement ($2.5 million after tax or $0.05 per
    diluted share).
  *$2.1 million higher breakage income on unused gift and merchandise return
    cards as a result of changes in breakage assumptions during the second
    quarter of 2012 ($1.3 million after tax or $0.03 per diluted share).
  *$2.5 million tax benefit recorded in the fourth quarter resulting from the
    tax impact of the deductibility in 2012 of previously non-deductible
    financial statement accruals relating to the elimination of the
    post-retirement life insurance benefits ($0.05 per diluted share).

Excluding these items, the Company would have net income of $23.8 million, or
$0.54 per diluted share, and EBITDA of $62.0 million for the year ended
February 2, 2013.

For the fourth quarter, net income was $13.5 million or $0.30 per diluted
share compared to net income of $5.9 million or $0.13 per diluted share in
2011.

Comments on Results

"I am extremely proud of our 2012 sales performance which drove outstanding
bottom line results. We did this by returning to those things that made this
company great, including a compelling merchandise assortment, selectively
lowering merchandise prices and controlling regular-price couponing," said Jay
Stein, Chief Executive Officer. "We are thankful that the financial
restatement is now behind us and we continue to be keenly focused on running
the business."

The month of January included an extra week in fiscal 2012, creating a 53-week
fiscal year. Total sales for the extra 53^rd week were approximately $15.8
million. Beginning with this release, our reported total sales (including past
periods which are restated) include leased shoe department commissions which
had previously been included in other income, net. Comparable store sales do
not include leased shoe department commissions.

Total sales for the 53-week period ended February 2, 2013 were $1.23 billion,
an increase of 4.6 percent over sales of $1.18 billion for the 52-week period
ended January 28, 2012. Comparable store sales for the 52-week period ended
January 26, 2013 increased 2.7 percent over the 52-week period ended January
28, 2012.

Total sales for the 14-week period ended February 2, 2013 were $368.6 million,
an increase of 11.4 percent over sales of $331.0 million for the 13-week
period ended January 28, 2012. Comparable store sales for the 13-week period
ended January 26, 2013 increased 6.0 percent over the 13-week period ended
January 28, 2012.

Gross profit for the year increased $23.0 million to $342.6 million or 27.8
percent of sales from $319.6 million or 27.1 percent of sales in 2011 due to
increased sales and an increase in the gross profit rate. The increase in the
gross profit rate was the result of lower markdowns resulting from our
strategy of reducing coupons applicable to our regular-priced merchandise
partially offset by lower markup due to lowering prices on selective
merchandise.

Selling, general and administrative expenses ("SG&A") were $306.4 million this
year compared to $287.2 million last year. The increase in SG&A includes
higher depreciation, compensation and benefit costs, and professional fees
(including the $4.0 million of fees related to the restatement) and lower
credit card program income (now included in SG&A and restated for all prior
periods presented), partially offset by $3.7 million lower advertising
expenses, $2.1 million higher breakage income on unused gift and merchandise
return cards as a result of changes in breakage assumptions and a decrease in
credit card interchange fees.

The effective tax rate for fiscal year 2012 decreased to 30.5 percent from
38.0 percent in 2011 due to the favorable impact from the elimination of the
post-retirement life insurance benefit during the fourth quarter.

Restated Results

Today, we filed our Form 10-K for the fiscal year ended February 2, 2013, our
amended quarterly report on Form 10-Q/A for the first quarter of 2012 and our
quarterly reports on Form 10-Q for the second and third quarters of 2012. As
previously reported, the quarterly filings were delayed as we completed our
financial restatement. Each of these quarterly reports includes restated
unaudited interim financial statements for the comparative fiscal 2011
periods.

Results for all quarters in fiscal 2011 and the first quarter of 2012 included
in this press release and the attached statements reflect adjustments for
inventory markdowns, leasehold improvement costs, compensated absences (paid
vacation) and indirect overhead (quarters only impacted). In addition, the
restated financial statements reflect the correction of certain previously
identified errors and out of period adjustments that were deemed immaterial to
the annual and interim period in which they were initially recorded and have
now been restated to properly reflect the corrections in the appropriate
periods. All financial statements included in this press release that are
impacted indicate the restated amounts as "Restated."

The effect of the adjustments for fiscal 2011 was to increase previously
reported net income by $0.1 million (see Note 2 in the attached materials).
The impact on individual quarters was generally a reduction in first quarter
income with increases in second and third quarter income. See Note 3 in the
attached materials for tables that present the effect of corrections to the
Consolidated Statements of Income for each quarterly period of 2011 and the
first quarter of 2012.

Balance Sheet Highlights

Cash at year end 2012 was $67.2 million, after paying a dividend of $43.8
million, compared to $94.1 million in 2011. The Company has no debt and had no
borrowings under its credit facility during 2012 or 2011.

Inventories were $243.3 million at year-end 2012 compared to $218.8 million at
the end of 2011. Year-end inventories were higher than last year, as planned,
due to an additional week of early season spring receipts from the shift of
the 53^rd week into fiscal 2012, as well as a strategy to increase wear-now
merchandise to drive early first quarter selling.

Capital expenditures were $45.4 million for 2012 driven by our investment in
information systems, including our new merchandise information system, as well
as new, relocated and remodeled stores.

Store Network

Six new stores were opened, five were closed and four were relocated in
2012.The company operated 263 Stein Mart stores at year-end compared to 262
at the end of 2011.

2013 Plans

In 2013, we are continuing to embrace our value proposition with controlled
couponing and even lower prices on selected merchandise.Our goal is to build
on the sales increases we experienced in 2012 primarily by deepening our
relationship with existing customers, attracting new customers and increasing
our share of their spending.

We expect the following factors to influence our business in 2013:

  *The gross profit rate is expected to be slightly lower than in 2012 as we
    continue to manage our selling prices and couponing and from lower margins
    on e-commerce sales in the second half of the year.
  *SG&A expenses are expected to increase $3-4 million as a result of the
    following:  

    *We will incur approximately $3 million in start-up costs related to the
      launch of our new e-commerce business and the transition of our supply
      chain from third-party to company-operated locations.
    *Depreciation will increase by approximately $3 million as a result of
      recent years' investments in capital.
    *2012 SG&A included the impact of certain expenses and income not
      expected to reoccur in 2013, including $4.0 million of legal and
      accounting fees related to the restatement of our financial statements
      and $2.1 million of higher breakage income on unused gift and
      merchandise return cards as a result of changes in breakage assumptions.

  *The effective tax rate for the year is expected to be approximately 39.5
    percent.
  *Current plans are to open four stores, close three stores and relocate
    four stores to better locations in their respective markets in 2013.
  *Capital expenditures for 2013 are expected to be approximately $34
    million, including $14 million for continuing information system upgrades,
    $5 million for distribution center equipment and software, and the
    remainder for new and relocated stores, store remodels and new fixtures.

We will be launching our new e-commerce business in mid to late 2013 with a
representative merchandise selection.This will enable us to reach new
customers and increase our share of existing customers' spend through a
multi-channel approach.As noted above, this initiative will actually have a
negative bottom line impact in 2013 from start-up costs and margins that are
lower than for our brick and mortar stores due to relatively high fulfillment
costs at our initial expected sales volume levels.This is an important
initiative from which we expect significant future benefit as we grow our
sales.

Another important initiative for 2013 is our transitioning of our supply chain
distribution centers from third-party to company-operated locations beginning
in the second quarter.While this change will not result in an immediate
savings in distribution expenses due to start-up costs and an initial capital
investment in equipment and software, this initiative offers an excellent
return on our investment with positive impact starting in 2014.

Conference Call

A conference call for investment analysts to discuss the Company's fourth
quarter and fiscal year 2012 results will be held at 10 a.m. EDT on May 8,
2013.The call may be heard on the investor relations portion of the Company's
website at http://ir.steinmart.com.A replay of the conference call will be
available on the website through May 31, 2013.

Investor Presentation

Stein Mart's fiscal 2012 investor presentation has been posted to the investor
relations portion of the Company's website at http://ir.steinmart.com.The
Company will also post supplemental information related to fiscal years 2008
and 2009 restated Unaudited Consolidated Statements of Income on the Events
and Presentations section of the investor relations website.

April Same Store Sales Release Timing

We currently plan to report our April and first quarter 2013 sales on May 8,
2013.

First Quarter Release Timing

We currently plan to release our first quarter 2013 earnings and hold our
conference call on May 23. 2013.The conference call will again be at 10:00
a.m. EDT.

About Stein Mart

Stein Mart stores offer the fashion merchandise, service and presentation of a
better department or specialty store, at prices competitive with off-price
retail chains.Currently with locations from California to Massachusetts,
Stein Mart's focused assortment of merchandise features current season,
moderate to better fashion apparel for women and men, as well as accessories,
shoes and home fashions.

SAFE HARBOR STATEMENT>>>>>>>Except for historical information contained
herein, the statements in this release may be forward-looking, and are made
pursuant to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. The Company does not assume any obligation to update or
revise any forward-looking statements even if experience or future changes
make it clear that projected results expressed or implied will not be
realized.Forward-looking statements involve known and unknown risks and
uncertainties that may cause Stein Mart's actual results in future periods to
differ materially from forecasted or expected results.Those risks include,
without limitation:

  oconsumer sensitivity to economic conditions
  ocompetition in the retail industry
  ochanges in consumer preferences and fashion trends
  othe effectiveness of advertising, marketing and promotional strategies
  oability to negotiate acceptable lease terms with current and potential
    landlords
  oability to successfully implement strategies to exit under-performing
    stores
  oextreme and/or unseasonable weather conditions
  oadequate sources of merchandise at acceptable prices
  odependence on certain key personnel and ability to attract and retain
    qualified employees
  oincreases in the cost of employee benefits
  odisruption of the Company's distribution process
  oinformation technology failures
  oacts of terrorism
  omaterial weaknesses in internal control over financial reporting
  oother risks and uncertainties described in the Company's filings with the
    Securities and Exchange Commission.

SMRT-F

        Additional information about Stein Mart, Inc. can be found at
                              www.steinmart.com


Stein Mart, Inc.
Consolidated Balance Sheets
(In thousands, except for share and per share data)
                                                            
                                            February 2, 2013 January 28, 2012
                                                            (Restated)
ASSETS                                                       
Current assets:                                              
Cash and cash equivalents                    $67,233        $94,053
Inventories                                  243,345         218,832
Prepaid expenses and other current assets    22,855          34,139
Total current assets                         333,433         347,024
Property and equipment, net                  131,570         109,990
Other assets                                 26,706          22,569
Total assets                                 $491,709       $479,583
LIABILITIES AND SHAREHOLDERS' EQUITY                         
Current liabilities:                                         
Accounts payable                             $130,972       $106,063
Accrued expenses and other current           66,109          68,063
liabilities
Total current liabilities                    197,081         174,126
Other liabilities                            60,594          55,786
Total liabilities                            257,675         229,912
Shareholders' equity:                                        
Preferred stock -- $.01 par value; 1,000,000
shares authorized; no shares issued or                       
outstanding
Common stock -- $.01 par value; 100,000,000
shares authorized; 43,808,485 and 43,588,821 438             436
shares issued and outstanding, respectively
Additional paid-in capital                   17,491          15,268
Retained earnings                            216,574         235,386
Accumulated other comprehensive loss         (469)           (1,419)
Total shareholders' equity                   234,034         249,671
Total liabilities and shareholders' equity   $491,709       $479,583



Stein Mart, Inc.
Consolidated Statements of Income
(In thousands, except for per share amounts)
                                                              
                            14 Weeks    13 Weeks    Year Ended   Year Ended
                             Ended       Ended
                            February 2, January 28, February 2,  January 28,
                             2013        2012        2013         2012
                                       (Restated)              (Restated)
                                                              
Net sales                    $368,557  $330,952  $1,232,366 $1,177,951
Cost of merchandise sold     262,300    243,460    889,736     858,335
Gross profit                 106,257    87,492     342,630     319,616
Selling, general and         89,101     78,243     306,407     287,184
administrative expenses
Operating income             17,156     9,249      36,223      32,432
Interest expense, net        55         35         225         286
Income before income taxes   17,101     9,214      35,998      32,146
Income tax provision         3,554      3,321      10,971      12,215
Net income                   $13,547   $5,893    $25,027    $19,931
                                                              
Net income per share:                                          
Basic                        $0.31     $0.13     $0.57      $0.45
Diluted                      $0.30     $0.13     $0.57      $0.44
                                                              
Weighted-average shares                                        
outstanding:
Basic                        42,688     42,733     42,639      43,482
Diluted                      43,004     42,769     42,828      43,721



Stein Mart, Inc.
Consolidated Statements of Comprehensive Income
(In thousands)
                                                               
                              14 Weeks    13 Weeks    Year Ended  Year Ended
                               Ended       Ended
                              February 2, January 28, February 2, January 28,
                               2013        2012        2013        2012
                                         (Restated)             (Restated)
                                                               
Net income                     $13,547   $5,893    $25,027   $19,931
Other comprehensive income                                      
(loss), net of tax:
Change in post-retirement      873        (1,875)    950        (1,875)
benefitobligations
Comprehensive income           $14,420   $4,018    $25,977   $18,056



Stein Mart, Inc.
Consolidated Statements of Cash Flows
(In thousands)
                                                            
                                            Year Ended       Year Ended
                                            February 2, 2013 January 28, 2012
                                                            (Restated)
Cash flows from operating activities:                        
Net income                                   $25,027        $19,931
Adjustments to reconcile net income to net                   
cash provided by operating activities:
Depreciation and amortization                23,911          18,614
Share-based compensation                     6,203           3,821
Store closing charges                        996             793
Impairment of property and other assets      523             1,166
Loss on disposal of property and equipment   1,324           77
Deferred income taxes                        2,916           12,247
Tax deficiency from equity issuances         (510)           (437)
Excess tax benefits from share-based         (640)           (375)
compensation
Changes in assets and liabilities:                           
Inventories                                  (24,513)        10,864
Prepaid expenses and other current assets    11,836          (12,986)
Other assets                                 (4,137)         (3,515)
Accounts payable                             24,909          10,518
Accrued expenses and other current           450             (3,518)
liabilities
Other liabilities                            3,044           7,384
Net cash provided by operating activities    71,339          64,584
Cash flows from investing activities:                        
Capital expenditures                         (45,426)        (38,012)
Cash used in investing activities            (45,426)        (38,012)
Cash flows from financing activities:                        
Cash dividends paid                          (43,839)        --
Capital lease payments                       (6,066)         (3,362)
Excess tax benefits from share-based         640             375
compensation
Proceeds from exercise of stock options and  471             2,891
other
Repurchase of common stock                   (3,939)         (12,141)
Net cash used in financing activities        (52,733)        (12,237)
Net (decrease) increase in cash and cash     (26,820)        14,335
equivalents
Cash and cash equivalents at beginning of    94,053          79,718
year
Cash and cash equivalents at end of year     $67,233        $94,053

NOTES TO PRESS RELEASE

Note 1 – EBITDA:

As used in this release, EBITDA is defined as earnings before interest, income
taxes, depreciation and amortization. EBITDA is not a measure of financial
performance under generally accepted accounting principles ("GAAP"). However,
we present EBITDA in this release because we consider it to be an important
supplemental measure of our performance and because it is frequently used by
analysts, investors and others to evaluate the performance of
companies.EBITDA is not calculated in the same manner by all
companies.EBITDA should be used as a supplement to results of operations and
cash flows as reported under GAAP and should not be considered to be a more
meaningful measure than, or an alternative to, measures of operating
performance as determined in accordance with GAAP. Below is a reconciliation
of Operating income to EBITDA for the years ended February 2, 2013 and January
28, 2012.

                                           Year Ended       Year Ended
                                           February 2, 2013 January 28, 2012
                                                           (Restated)
Operating income                            $36,223        $32,432
Add back amounts for computation of EBITDA:                 
Depreciation and amortization               23,911          18,614
EBITDA                                      $60,134        $51,046

Note 2 - RESTATEMENT ITEMS:

Our Consolidated Financial Statements for the first quarter of fiscal 2012 and
all periods in fiscal year 2011 have been restated for the errors described
below.

Reclassifications

We have made certain reclassifications in the Consolidated Statements of
Income related to breakage income on unused gift and merchandise return cards
and credit card income related to our co-branded and private label credit card
agreement which were presented in Other income, net and have been reclassified
to SG&A. There were no reclassifications made to the Consolidated Balance
Sheets, Consolidated Statements of Comprehensive Income or Consolidated
Statements of Cash Flows.

Adjustments

The following is a description of the areas in which the errors were
identified and for which we made correcting adjustments to our Consolidated
Financial Statements.The associated income tax expense or benefit and related
deferred tax asset or liability for each error has also been corrected.

(1) Inventory markdowns - We identified and corrected errors related to the
incorrect treatment of certain inventory markdowns as promotional (temporary).
Based on analysis of various factors, these inventory markdowns should have
been accounted for as permanent markdowns.Under the retail inventory method
of accounting used by us, promotional markdowns do not impact the value of
unsold inventory and thus do not impact cost of sales until the merchandise is
sold.Conversely, permanent markdowns reduce the value of unsold inventory and
impact cost of sales at the time the markdowns are taken.

(2) Leasehold improvement costs - We identified and corrected errors to report
fixed assets related to leasehold improvements at their gross amount with
lessor reimbursements for the related construction recorded as deferred rent
credits.Landlord (lessor) reimbursements to us (lessee) for store interior
construction had been incorrectly accounted for as reductions in the fixed
assets related to leasehold improvements.This practice was based on the prior
belief that our leasehold improvements increased the fair value of the
lessor's property.Management now believes that there was no significant
increase in the fair value of the lessor's leased assets and therefore these
leasehold improvements should have been recorded, depreciated over and subject
to impairment exclusive of lessor reimbursements in the respective
periods.Cost of merchandise sold decreased by $3.0 million and SG&A expenses
increased by $1.1 million for 2011 as a result of this adjustment.

(3) Compensated absences (paid vacation) - We identified and corrected errors
to record liabilities for compensated absences (paid vacation) which were not
previously recorded.

(4) Leased department commissions - We corrected the presentation of leased
department commissions in the Consolidated Statements of Income. Leased
department commissions were presented in Other income, net of related expenses
and have been corrected to report Net sales (increase of $19.1 million for
2011) and SG&A expenses (increase of $6.4 million for 2011) on a gross
basis.There was no impact to Net income related to this change.

(5) Sales returns - We corrected the presentation of estimated sales returns
in the Consolidated Statements of Income. Estimated sales returns were
previously incorrectly presented on a net basis and have been presented on a
gross basis in Net sales and Cost of merchandise sold (adjustment of $1.5
million for 2011). There was no impact to Net income related to this change.

(6)Insurance-related assets and liabilities - We corrected the presentation
of insurance-related assets and liabilities in the Consolidated Balance
Sheets. The long-term portion of insurance assets ($7.1 million as of January
28, 2012) were previously incorrectly reported as Prepaid expenses and other
current assets and are now reported as Other assets. The long-term portion of
insurance liabilities ($11.5 million as of January 28, 2012)was previously
incorrectly reported as Accrued expenses and other current liabilities andis
now reported as Other liabilities. There was no impact on Total assets or
Total liabilities related to this change.

(7)Other - We corrected certain previously identified errors and out of
period adjustments that were deemed immaterial to the annual or interim period
in which they were recorded and restated prior periods to reflect these
corrections in the appropriate periods.The amounts relate to credit card
reward income breakage, credit card receivables, software costs, and assets no
longer in use.

The net effect of the adjustments on the Consolidated Statement of Income was
to increase Net income by $0.1 million for the year ended January 28, 2012 as
follows:

Increase (decrease) in Net Income   2011
Inventory markdowns                 $655
Leasehold improvement costs         1,937
Compensated absences                (134)
Other                               (2,283)
Total adjustments before tax        175
Income tax expense from adjustments 72
Increase in Net income              $103

The adjustments in "Other" in 2011 relate primarily to thecorrection of a
previously recorded out of period adjustment related to credit card reward
income breakage of $2.0 million.

The following tables present the effect of the aforementioned
reclassifications and adjustments on our Consolidated Balance Sheet as of
January 28, 2012 and our Statements of Income and Cash Flows for the fiscal
year ended January 28, 2012 on GAAP basis and indicate the category of the
adjustments by reference to the above descriptions of the errors for which we
made corrections.

Consolidated Balance Sheet

                         As of January 28, 2012
                         As Previously            Description of 
                         Reported      Adjustments Adjustments    As Restated
ASSETS                                                          
Current assets:                                                 
Cash and cash equivalents $94,053     $--                     $94,053
Inventories               220,775      (1,943)    (1)            218,832
Prepaid expenses and      36,838       (2,699)    (2)(6)(7)      34,139
other current assets
Total current assets      351,666      (4,642)                  347,024
Property and equipment,   104,141      5,849      (2)(7)         109,990
net
Other assets              17,409       5,160      (2)(6)         22,569
Total assets              $473,216    $6,367                  $479,583
LIABILITIES AND                                                 
SHAREHOLDERS' EQUITY
Current liabilities:                                            
Accounts payable          $106,063    $--                     $106,063
Accrued expenses and      72,731       (4,668)    (3)(6)         68,063
other current liabilities
Total current liabilities 178,794      (4,668)                  174,126
Other liabilities         35,084       20,702     (2)(6)         55,786
Total liabilities         213,878      16,034                   229,912
Shareholders' equity:                                           
Preferred stock -- $.01
par value; 1,000,000
shares authorized; no                                           
shares issued or
outstanding
Common stock -- $.01 par
value; 100,000,000 shares
authorized; 43,588,821    436          --                       436
shares issued and
outstanding
Additional paid-in        15,268       --                       15,268
capital
Retained earnings         245,053      (9,667)    (1)(2)(3)(7)   235,386
Accumulated other         (1,419)      --                       (1,419)
comprehensive loss
Total shareholders'       259,338      (9,667)                  249,671
equity
Total liabilities and     $473,216    $6,367                  $479,583
shareholders' equity

Consolidated Statement of Income

              Year Ended January 28, 2012
              As                                     Description  
               Previously                               of
              Reported   Reclassifications Adjustments Adjustments  As
                                                                     Restated
Net sales      $         $--             $ 17,584   (4)(5)       $
               1,160,367                                             1,177,951
Cost of
merchandise    863,003   --               (4,668)    (1)(2)(5)    858,335
sold
Gross profit   297,364   --               22,252                 319,616
Selling,
general and    289,114   (11,273)         9,343      (2)(3)(4)(7) 287,184
administrative
expenses
Other income,  24,007    (11,273)         (12,734)   (4)          --
net
Operating      32,257    --               175                    32,432
income
Interest       286       --               --                     286
expense, net
Income before  31,971    --               175                    32,146
income taxes
Income tax     12,143    --               72         (1)(2)(3)(7) 12,215
expense
Net income     $19,828  $--             $103                  $19,931
                                                                
Net income per                                                   
share:
Basic          $0.44    $--            $0.01                 $0.45
Diluted        $0.44    $--            $--                  $0.44

Consolidated Statement of Cash Flows

                                Year Ended January 28, 2012
                                As                    Description  
                                 Previously             of
                                Reported   Adjustments Adjustments  As
                                                                     Restated
Cash flows from operating                                         
activities:
Net income                       $19,828  $103      (1)(2)(3)(7) $ 19,931
Adjustments to reconcile net
income tonet cash provided by                                    
operating activities:
Depreciation and amortization    18,937    (323)      (2)(7)       18,614
Share-based compensation         3,821     --                     3,821
Store closing charges            793       --                     793
Impairment of property andother 1,166     --                     1,166
assets
Loss on disposal of property     --         77          (7)          77
andequipment
Deferred income taxes            12,766     (519)       (1)(2)(3)(7) 12,247
Tax deficiency from equity       (437)      --                      (437)
issuances
Excess tax benefits from         (375)      --                      (375)
share-basedcompensation
Changes in assets and                                             
liabilities:
Inventories                      11,520     (656)       (1)          10,864
Prepaid expenses and             (12,173)   (813)       (2)(6)(7)    (12,986)
othercurrent assets
Other assets                     (3,796)    281         (2)(7)       (3,515)
Accounts payable                 10,518     --                      10,518
Accrued expenses and             (4,857)    1,339       (3)(6)       (3,518)
othercurrent liabilities
Other liabilities                1,857      5,527       (2)(6)       7,384
Net cash provided by operating   59,568     5,016                   64,584
activities
Cash flows from investing                                         
activities:
Acquisition of property and      (33,449)   (4,563)     (2)(7)       (38,012)
equipment
Net cash used in investing       (33,449)   (4,563)                 (38,012)
activities
Cash flows from financing                                         
activities:
Capital lease payments           (3,362)    --                      (3,362)
Excess tax benefits from         375       --                     375
share-based compensation
Proceeds from exercise of stock  2,891     --                     2,891
optionsand other
Repurchase of common stock       (12,141)  --                     (12,141)
Net cash used in financing       (12,237)  --                     (12,237)
activities
Net increase in cash and cash    13,882    453        (7)          14,335
equivalents
Cash and cash equivalents at     80,171    (453)      (7)          79,718
beginning of year
Cash and cash equivalents at end $94,053  $--                   $ 94,053
of year

Consolidated Statement of Income (Non-GAAP)

The table below shows the impact of the restatement on the Statement of Income
on a Non-GAAP basis. This table differs from the preceding GAAP table as it
moves adjustments that did not impact net income out of the "Adjustments"
column.Management believes that this presentation is important to investors
to highlight those adjustments which do not impact income.

                         Year Ended January 28, 2012
                                      Adjustments              
                         As Previously Not Impacting            
                         Reported      Net Income    Adjustments As Restated
Net sales                 $ 1,160,367  $17,584     $--       $ 1,177,951
                                                              
Cost of merchandise sold  863,003      (1,516)      (3,152)    858,335
Gross profit              297,364      19,100       3,152      319,616
Selling, general and      289,114      (4,907)      2,977      287,184
administrative expenses
Other income, net         24,007       (24,007)     --         --
Operating income          32,257       --           175        32,432
Interest expense, net     286          --           --         286
Income before income      31,971       --           175        32,146
taxes
Income tax expense        12,143       --           72         12,215
Net income                $19,828     $--         $103      $19,931
Net income per share:                                          
Basic                     $0.44        $--         $0.01     $0.45
Diluted                   $0.44        $--         $--       $0.44

Note 3 - SELECTED UNAUDITED QUARTERLY FINANCIAL DATA:

In addition to the restatement of the fiscal 2011 annual period presented
above, we also restated our interim financial data for all quarterly periods
in fiscal 2011 and the first quarterly period of fiscal 2012. The following
tables present the effect of the corrections on each Unaudited Quarterly
Consolidated Statement of Income for the fiscal year ended January 28, 2012
and the quarterly period ended April 28, 2012. Additional commentary on the
results of these restated quarterly periods will be available in the Company's
following SEC filings:

  *Form 10-Q/A for the fiscal quarter ended April 28, 2012
  *Form 10-Q for the fiscal quarter ended July 28, 2012
  *Form 10-Q for the fiscal quarter ended October 27, 2012

Quarterly Period Ended April 30, 2011

                       13 Weeks Ended April 30, 2011
                       As Previously                            
                       Reported      Reclassification Adjustments As Restated
Net sales               $303,546    $--            $5,672    $309,218
Cost of merchandise     213,626      --              1,038      214,664
sold
Gross profit            89,920       --              4,634      94,554
Selling, general and    71,936       (4,534)         4,105      71,507
administrative expenses
Other income, net       8,316        (4,534)         (3,782)    --
Operating income        26,300       --              (3,253)    23,047
Interest expense, net   85           --              --         85
Income before income    26,215       --              (3,253)    22,962
taxes
Income tax expense      10,315       --              (1,253)    9,062
Net income              $15,900     $--            $(2,000)  $13,900
                                                               
Net income per share:                                           
Basic                   $0.35       $--           $(0.04)   $0.31
Diluted                 $0.35       $--           $(0.04)   $0.31

Quarterly Period Ended July 30, 2011

                       13 Weeks Ended July 30, 2011
                       As Previously                            
                       Reported      Reclassification Adjustments As Restated
Net sales               $270,167    $--            $4,382    $274,549
Cost of merchandise     204,796      --              (1,164)    203,632
sold
Gross profit            65,371       --              5,546      70,917
Selling, general and    68,265       (2,304)         1,783      67,744
administrative expenses
Other income, net       5,141        (2,220)         (2,921)    --
Operating income        2,247        84              842        3,173
Interest (income)       (3)          84              1          82
expense, net
Income before income    2,250        --              841        3,091
taxes
Income tax expense      934          --              323        1,257
Net income              $1,316      $--            $518      $1,834
                                                               
Net income per share:                                           
Basic                   $0.03       $--           $0.01     $0.04
Diluted                 $0.03       $--           $0.01     $0.04

Quarterly Period Ended October 29, 2011

                       13 Weeks Ended October 29, 2011
                       As Previously                            
                       Reported      Reclassification Adjustments As Restated
Net sales               $258,520    $--            $4,712    $263,232
Cost of merchandise     199,264      --              (2,685)    196,579
sold
Gross profit            59,256       --              7,397      66,653
Selling, general and    71,291       (3,560)         1,959      69,690
administrative expenses
Other income, net       6,602        (3,460)         (3,142)    --
Operating loss          (5,433)      100             2,296      (3,037)
Interest (income)       (16)         100             --         84
expense, net
Loss before income      (5,417)      --              2,296      (3,121)
taxes
Income tax benefit      (2,311)      --              886        (1,425)
Net loss                $(3,106)    $--            $1,410    $(1,696)
                                                               
Net income per share:                                           
Basic                   $(0.07)     $--           $0.03     $(0.04)
Diluted                 $(0.07)     $--           $0.03     $(0.04)

Quarterly Period Ended January 28, 2012

                       13 Weeks Ended January 28, 2012
                       As Previously                            
                       Reported      Reclassification Adjustments As Restated
Net sales               $328,134    $--            $2,818    $330,952
Cost of merchandise     245,317      --              (1,857)    243,460
sold
Gross profit            82,817       --              4,675      87,492
Selling, general and    77,807       (1,059)         1,495      78,243
administrative expenses
Other income, net       3,948        (1,059)         (2,889)    --
Operating loss          8,958        --              291        9,249
Interest expense, net   35           --              --         35
Loss before income      8,923        --              291        9,214
taxes
Income tax expense      3,205        --              116        3,321
Net loss                $5,718      $--            $175      $5,893
                                                               
Net income per share:                                           
Basic                   $0.13       $--           $--      $0.13
Diluted                 $0.13       $--           $--      $0.13

Quarterly Period Ended April 28, 2012

                       13 Weeks Ended April 28, 2012
                       As Previously                            
                       Reported      Reclassification Adjustments As Restated
Net sales               $303,392    $--            $6,316    $309,708
Cost of merchandise     216,163      --              1,681      217,844
sold
Gross profit            87,229       --              4,635      91,864
Selling, general and    71,349       (718)           2,276      72,907
administrative expenses
Other income, net       4,538        (718)           (3,820)    --
Operating income        20,418       --              (1,461)    18,957
Interest expense, net   46           --              --         46
Income before income    20,372       --              (1,461)    18,911
taxes
Income tax expense      8,540        --              (462)      8,078
Net income              $11,832     $--            $(999)    $10,833
                                                               
Net income per share:                                           
Basic                   $0.27       $--           $(0.02)   $0.25
Diluted                 $0.27       $--           $(0.02)   $0.25

The following tables present the Unaudited Quarterly Consolidated Statements
of Income for the second and third quarters of 2012 including restated
unaudited interim financial statements for comparative fiscal 2011 periods.
Additional commentary on the results of these quarterly periods will be
available in the Company's Form 10-Qs for the fiscal quarters ended July 28,
2012 and October 27, 2012.

Quarterly Period Ended July 28, 2012

                                            13 Weeks Ended 13 Weeks Ended
                                            July 28, 2012  July 30, 2011
                                                          (Restated)
                                                          
Net sales                                    $280,372     $274,549
Cost of merchandise sold                     206,553       203,632
Gross profit                                 73,819        70,917
Selling, general and administrative expenses 69,968        67,744
Operating income                             3,851         3,173
Interest expense, net                        43            82
Income before income taxes                   3,808         3,091
Income tax expense                           1,502         1,257
Net income                                   $2,306       $1,834
                                                          
Net income per share:                                      
Basic                                        $0.05        $0.04
Diluted                                      $0.05        $0.04
                                                          
Weighted-average shares outstanding:                       
Basic                                        42,586        44,095
Diluted                                      42,715        44,415

Quarterly Period Ended October 27, 2012

                                            13 Weeks Ended   13 Weeks Ended
                                            October 27, 2012 October 29, 2011
                                                            (Restated)
                                                            
Net sales                                    $273,729       $263,232
Cost of merchandise sold                     203,039         196,579
Gross profit                                 70,690          66,653
Selling, general and administrative expenses 74,431          69,690
Operating (loss) income                      (3,741)         (3,037)
Interest expense, net                        81              84
(Loss) income before income taxes            (3,822)         (3,121)
Income tax (benefit) expense                 (2,163)         (1,425)
Net (loss) income                            $(1,659)       $(1,696)
                                                            
Net (loss) income per share:                                 
Basic                                        $(0.04)        $(0.04)
Diluted                                      $(0.04)        $(0.04)
                                                            
Weighted-average shares outstanding:                         
Basic                                        42,568          43,248
Diluted                                      42,568          43,248

CONTACT: Linda L. Tasseff
         Director, Investor Relations
         (904) 858-2639
         ltasseff@steinmart.com

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