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Stein Mart, Inc. Reports First Quarter 2013 Financial Results



Stein Mart, Inc. Reports First Quarter 2013 Financial Results

Highlights:

  * Diluted earnings per share of $0.33 compared to $0.25 last year.
  * Net income of $14.7 million increases 35.6 percent.
  * Comparable store sales up 1.2 percent.

JACKSONVILLE, Fla., May 23, 2013 (GLOBE NEWSWIRE) -- Stein Mart, Inc.
(Nasdaq:SMRT) today announced financial results for the first quarter ended
May 4, 2013.

Overview of Results

Net income for the first quarter of 2013 was $14.7 million or $0.33 per
diluted share compared to net income of $10.8 million or $0.25 per diluted
share in 2012. EBITDA for the first quarter increased 29.3 percent to $31.2
million compared to $24.1 million in 2012 (see Note 1).

Total sales for the first quarter of 2013 increased 3.8 percent to $321.4
million, while comparable store sales increased 1.2 percent.

"We ended the quarter strongly with an 8.0 percent comp sales increase in
April and a positive comp for the quarter, despite a slow start caused by
colder than normal weather and the Easter calendar shift," said Jay Stein,
Chief Executive Officer. "Our increased sales and a higher gross profit rate
leveraged against relatively flat expenses drove our substantially higher
earnings."

Comments on Results

Gross profit for the first quarter increased to $97.9 million or 30.5 percent
of sales from $91.9 million or 29.7 percent of sales in 2012. The increase in
gross profit was due to increased sales and an increase in the gross profit
rate which was primarily the result of lower markdowns.

Selling, general and administrative ("SG&A") expenses for the first quarter
were $73.6 million or 22.9 percent of sales compared to $72.9 million or 23.6
percent of sales in 2012. The slight increase in SG&A expenses was primarily
due to higher depreciation expense and $0.7 million of additional professional
fees associated with our restatement, partially offset by various other cost
reductions.

The effective tax rate was 39.6 percent for the first quarter of 2013 compared
to 42.7 percent in 2012. Last year's rate was higher primarily due to
non-deductible expenses associated with our post-retirement life insurance
benefit that was discontinued during the fourth quarter of 2012.

Balance Sheet Highlights

Cash at year end of the first quarter was $83.9 million, after paying a
dividend of $43.8 million at the end of 2012, compared to $116.7 million at
the end of the first quarter of 2012. We have not borrowed on our credit
facility since the beginning of 2009.

Inventories were $278.4 million at the end of the first quarter of 2013
compared to $262.8 million at the end of the first quarter last year.
Inventories were higher than last year to support our higher sales.

Store Network

The Company operated 262 Stein Mart stores at the end of the first quarter of
2013 and 263 stores at the end of the first quarter last year. During the
quarter, we relocated two stores and closed one store. We expect to open four
new stores, relocate two stores and close two stores during the second half of
the year.

Filing of Form 10-Q

Reported results are preliminary and not final until the filing of Form 10-Q
for the fiscal quarter ended May 4, 2013 with the SEC, and therefore remain
subject to adjustment.

Conference Call

A conference call for investment analysts to discuss the Company's first
quarter results will be held at 10 a.m. ET today, Thursday, May 23, 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 June 30, 2013.

Investor Presentation

Stein Mart's first quarter 2013 investor presentation has been posted to the
investor relations portion of the Company's website at
http://ir.steinmart.com.

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:

  o consumer sensitivity to economic conditions
  o competition in the retail industry
  o changes in consumer preferences and fashion trends
  o the effectiveness of advertising, marketing and promotional strategies
  o ability to negotiate acceptable lease terms with current and potential
    landlords
  o ability to successfully implement strategies to exit under-performing
    stores
  o extreme and/or unseasonable weather conditions
  o adequate sources of merchandise at acceptable prices
  o dependence on certain key personnel and ability to attract and retain
    qualified employees
  o increases in the cost of employee benefits
  o disruption of the Company's distribution process
  o information technology failures
  o acts of terrorism
  o material weaknesses in internal control over financial reporting
  o other risks and uncertainties described in the Company's filings with the
    Securities and Exchange Commission.

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.

SMRT-F

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

Stein Mart, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
(In thousands, except for share and per share data)
                                                                 
                                   May 4, 2013 February 2, 2013 April 28, 2012
ASSETS                                                           
Current assets:                                                  
Cash and cash equivalents           $ 83,946    $ 67,233         $ 116,723
Inventories                         278,435     243,345          262,780
Prepaid expenses and other current  18,007      22,855           21,050
assets
Total current assets                380,388     333,433          400,553
Property and equipment, net         132,335     131,570          113,856
Other assets                        26,603      26,706           22,887
Total assets                        $ 539,326   $ 491,709        $ 537,296
LIABILITIES AND SHAREHOLDERS'                                    
EQUITY
Current liabilities:                                             
Accounts payable                    $ 165,629   $ 130,972        $ 149,650
Accrued expenses and other current  65,755      66,109           74,189
liabilities
Total current liabilities           231,384     197,081          223,839
Other liabilities                   58,235      60,594           55,108
Total liabilities                   289,619     257,675          278,947
COMMITMENTS AND CONTINGENCIES                                    
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;
43,825,455, 43,808,485 and          438         438              433
43,295,411 shares issued and
outstanding, respectively
Additional paid-in capital          18,470      17,491           13,107
Retained earnings                   231,266     216,574          246,219
Accumulated other comprehensive     (467)       (469)            (1,410)
loss
Total shareholders' equity          249,707     234,034          258,349
Total liabilities and               $ 539,326   $ 491,709        $ 537,296
shareholders' equity

 
Stein Mart, Inc.
Condensed Consolidated Statements of Income
(Unaudited)
(In thousands, except per share amounts)
                                                             
                                             13 Weeks Ended 13 Weeks Ended
                                             May 4, 2013    April 28, 2012
                                                             
Net sales                                     $ 321,364      $ 309,708
Cost of merchandise sold                      223,419        217,844
Gross profit                                  97,945         91,864
Selling, general and administrative expenses  73,563         72,907
Operating income                              24,382         18,957
Interest expense, net                         61             46
Income before income taxes                    24,321         18,911
Income tax expense                            9,629          8,078
Net income                                    $ 14,692       $ 10,833
                                                             
Net income per share:                                        
Basic                                         $ 0.34         $ 0.25
Diluted                                       $ 0.33         $ 0.25
                                                             
Weighted-average shares outstanding:                         
Basic                                         42,814         42,712
Diluted                                       43,262         42,752

 
Stein Mart, Inc.
Condensed Consolidated Statements of Comprehensive Income
(Unaudited)
(In thousands)
                                                              
                                              13 Weeks Ended 13 Weeks Ended
                                              May 4, 2013    April 28, 2012
                                                              
Net income                                     $ 14,692       $ 10,833
Other comprehensive income, net of tax:                       
Change in post-retirement benefit obligations  2              9
Comprehensive income                           $ 14,694       $ 10,842

 
Stein Mart, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(In thousands)
                                                                 
                                                 13 Weeks Ended 13 Weeks Ended
                                                 May 4, 2013    April 28, 2012
Cash flows from operating activities:                            
Net income                                        $ 14,692       $ 10,833
Adjustments to reconcile net income to net cash                  
provided by operating activities:
Depreciation and amortization                     6,812          5,167
Share-based compensation                          1,362          729
Store closing charges                             (176)          146
Loss on disposal of property and equipment        120            96
Deferred income taxes                             1,865          (688)
Tax deficiency from equity issuances              (389)          (667)
Excess tax benefits from share-based              (24)           (33)
compensation
Changes in assets and liabilities:                               
Inventories                                       (35,090)       (43,948)
Prepaid expenses and other current assets         2,336          13,352
Other assets                                      103            (318)
Accounts payable                                  34,657         43,587
Accrued expenses and other current liabilities    329            6,590
Other liabilities                                 (826)          552
Net cash provided by operating activities         25,771         35,398
Cash flows from investing activities:                            
Acquisition of property and equipment             (7,697)        (9,120)
Net cash used in investing activities             (7,697)        (9,120)
Cash flows from financing activities:                            
Capital lease payments                            (1,391)        (1,415)
Excess tax benefits from share-based              24             33
compensation
Proceeds from exercise of stock options and       14             13
other
Repurchase of common stock                        (8)            (2,239)
Net cash used in financing activities             (1,361)        (3,608)
Net increase in cash and cash equivalents         16,713         22,670
Cash and cash equivalents at beginning of year    67,233         94,053
Cash and cash equivalents at end of period        $ 83,946       $ 116,723

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

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