Stein Mart, Inc. saw total sales for the five-week period ending Jan. 3, 2009 of $178 million, a decrease from $196.3 million during the comparable period last year. For the nine week period ending Jan. 3, 2009, total sales were $296.8 million compared to last years $336.4 million, and for year-to-date, total sales were $1,259.4 million compared to 2007's total of $1.376.6 million.
Comparable store sales dropped 9.3% for the five-week period ended Jan. 3, 2008, an increase from the 8.5% drop in last year's comparable period. Quarter-to-date, comp sales fell 11.8% this year, as opposed to 10.9% last year, and year-to-date comp sales fell 8.5% this year as opposed to 10.6% last year.
During December, ladies' social and dresses had the best sales performance, followed closely by ladies' casual sportswear, ladies' accessories and men's furnishings. The most difficult businesses were gifts and linens. In general, sales were better than trend west of the Mississippi River, but continued to be weak in the Southeast, especially Florida.
“As expected, it was a very challenging Christmas selling season, although our sales trend improved somewhat just prior to and following the actual Christmas holiday,” commented David H. Stovall, Jr., president and CEO of Stein Mart, Inc. “We did take extensive markdowns in order to clear seasonal merchandise, and ended the month with total inventories down 21% as compared to the same period last year.”
At Jan. 3, 2009, there were 278 stores in operation as compared to 280 at the same time last year.
As a result of the continued sales declines and the uncertainty of future business trends, a number of additional expense reduction actions will be effective immediately. These include reducing the number of assistant managers in most Stein Mart stores from two to one, resulting in the elimination of 178 positions, and the contraction of some additional store workforce hours. In addition, 31 field and corporate positions are also being eliminated, including 12 positions at the home office in Jacksonville. All remaining management will sustain a five percent salary reduction, and the Company has suspended its corporate matching contribution to associates' 401(k) and deferred compensation plans.
These initiatives should help align selling, general and administrative (SG&A) expenses with the Company's reduced revenues, and are in addition to earlier, already-announced reductions in management headcount, associate workforce hours and renegotiated contracts for non-merchandise procurement. Today's announcement and the earlier actions together should result in savings of $25 million in 2009. These savings do not include any benefit from the previously announced changes to the Company's supply chain/distribution process, which are expected to provide significant benefits when fully operational in 2010.
“These decisions, while difficult, underscore our philosophy to be fiscally conservative in a volatile economic climate,” noted Stovall. “Coupled with the Company's decisions to reduce capital expenditures and conserve cash, these expense reductions will enable us to compete in the current economic environment.”
