by Brian Lipton

stein_mart_logoFlorida-based Stein Mart, Inc. today announced financial results for the fourth quarter and fiscal year ended January 30, 2016, with fourth quarter sales and profits being particularly disappointing for the chain.

Total sales for the fourth quarter of 2015 increased 1.8 percent to $394.1 million, while comparable store sales decreased 1.1 percent. Gross profit for the fourth quarter of 2015 was $105.8 million or 26.8 percent of sales compared to $113.6 million or 29.4 percent of sales in 2014. The decrease in the gross profit rate is due to higher markdowns from lower than planned sales and an elevated promotional environment during the holiday selling season Net income for the fourth quarter was $6.3 million or $0.13 per diluted share compared to net income of $12.3 million or $0.27 per diluted share in 2014.

The news wasn’t much better for the fiscal year, On the plus side, total sales increased 3.2 percent to $1.36 billion, while comparable store sales increased 1.0 percent. Sales from the company’s ecommerce business increased by 70 percent in 2015. However, net income was $23.7 million or $0.51 per diluted share compared to $26.9 million or $0.59 per diluted share in 2014. Adjusted earnings before interest, income taxes, depreciation and amortization (“EBITDA”) for the year was $80.1 million compared to $87.0 million in 2014.

“Disappointing fourth quarter sales and a more promotional holiday selling season drove our results lower than the prior year. Our fourth quarter gross profit rate was lower as we made appropriate valuation decisions on inventories,” said Jay Stein, the company’s CEO. “On a positive note, we increased our comparable store sales for the year, had solid sales growth from 10 new stores and controlled our expenses well. We also ended the year with acceptable inventory levels going into our strong spring selling season.”

As of 10:15 a.m, Stein Mart stock was selling at 7.03, an 11.5 percent drop from the morning’s high price.