Stein Mart (SMRT) CEO to Resign; Q3 Comps Down 4%
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Stein Mart, Inc. (NASDAQ: SMRT) announced that Dawn Robertson has tendered her resignation as Chief Executive Officer and as a director, and the Company’s Board of Directors accepted that resignation effective as of September 27, 2016. Ms. Robertson also performed the duties of the chief merchandising officer. D. Hunt Hawkins, Stein Mart’s President and Chief Operating Officer, has been named Interim CEO and the Company will initiate a search for a new chief merchandising officer.
“Some of the sales initiatives that have been developed under Dawn’s leadership are important for our future and we will continue to cultivate them to drive sales in this challenging retail environment,” said Jay Stein, Chairman of the Board. “Hunt has been a valued leader at Stein Mart for over 20 years. The Board and I are confident in his ability to guide our associates and to continue implementing our strong sales strategies.”
Mr. Hawkins, 57, started his career with Stein Mart as Senior Vice President, Human Resources and was promoted to Executive Vice President of Operations in 2006, to Executive Vice President, Chief Administrative Officer in 2007, to Executive Vice President, Chief Operating Officer in 2011 and to President and Chief Operating Officer in 2014.
“I appreciate the confidence the Board has in me during this important time for the Company and look forward to serving in my new role,” said Hunt Hawkins. “One of my first priorities is to help our associates with their focus on the key objectives needed to have a successful fall selling season.”
Preview of Third Quarter Results Comparable store sales for the third quarter (which ends October 29, 2016) have decreased approximately 4 percent through September 27 compared to the same period last year. Sales results have improved somewhat in September after a challenging start and several missteps in August.
“We believe that several of the new merchandising strategies that have been developed this year will positively impact our future sales. However, implementation has been too rapid and has been challenging for our customers,” said Hunt Hawkins. “It is important that we remain focused on meeting the needs of our existing customers as we drive change.”
With sales lower than anticipated, the third quarter gross profit rate could be approximately 150 basis points lower than the third quarter of 2015 due to higher markdowns and higher occupancy costs, mostly from our new stores, which do not leverage on softer sales. The third quarter will include an approximate $1.6 million charge in connection with Ms. Robertson’s departure.
For the full year, we continue to expect selling, general and administrative expenses to be approximately $360 million. Financial results for the third quarter will be reported prior to the opening of the U.S. financial markets on Thursday, November 17, 2016.
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