US: Higher markdowns push Stein Mart to Q4 loss
Higher markdowns to clear seasonal merchandise from its shelves have pushed Stein Mart Inc to a fourth quarter loss and capped a year that the discount retailer described as "deeply disappointing."
For the three months to 2 February, the Jacksonville, Florida based company swung to a net loss of $12.1m or $0.30 per share, from a profit of $21.1m or $0.48 per diluted share in 2006.
Sales fell 9.4% to $417.4m from the $461.0m in for the comparable period last year, while same-store sales dropped 6.2%.
"The steep decline in business last fall required us to take an exceptional amount of markdowns in the fourth quarter to move seasonal merchandise," noted president and chief executive officer Linda M Farthing.
"Although very costly, it did allow us to reduce our overall inventory to levels more appropriate for this uncertain retailing climate."
For the fiscal year, the company's net loss was $4.5m or $0.11 per share, versus a profit of $37.2m or $0.85 per share the year before.
Annual sales were $1.46bn, down 2.9% from $1.50bn, and comparable store sales fell 4.0%.
Commenting on her plans for the current year, Farthing said: "We will be controlling inventory very tightly, and we have already taken steps to reduce our costs to only the most necessary expenditures."
More opportunistic purchasing, more product lines and expanded merchandise categories are some of the ways the company plans to enhance productivity.
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