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Home Textiles Help Soften 2Q Blow for Stein Mart

JACKSONVILLE, FLA. - Stein Mart Inc. experienced a difficult second quarter, but the period was a good one for home textiles, which was singled out among the top categories.
     Improved performances in home are part of the 260-unit off-price mid-tier department store chain's overall effort to sharpen merchandise mixes and align inventory more closely with sales trends across the store. More tweaking in home has begun with the recent addition of major brands, like Vera and Eileen West as well as some further "reinvigorating" in linens, gifts and other home-related areas, noted president and ceo David Stovall Jr. During Stein Mart's earnings conference call last week, an analyst asked Stovall about the impacts of price increases on the retailer's business.
     "Price increases in the first half have been in the mid-single digits and that will continue in the second half," he responded. "We are working with our vendors on that. But we see that pressure lessening as we talk about next spring."
     Overall, he said, "in most cases, we see that moderating."
     "Second quarter sales were disappointing, particularly following our positive first quarter performance," Stovall said. "Our entire team is focused on executing our strategies to accelerate sales and strengthen Stein Mart's position as a fashion-driven, value-oriented retailer. We are refining our assortments, improving our shopping experience, continuing to invest in customer research, and launching a new advertising campaign this fall."
     Because of an adjustment, Stein Mart's net income in the second quarter, ended July 30, dipped 88.5% to $1.3 million, or 3 cents per share. Net income as adjusted for the second quarter of 2010 was $3.0 million or 7 cents per share.
     After a positive first quarter sales performance, sales in the second quarter slipped 2.1% to $270.2 million. Comps decreased 1.1%.

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