Stein Mart suspends dividend
Stein Mart (SMRT) will suspend its $0.075 per share quarterly dividend.
Suspending the $0.075 quarterly dividend will free up approximately $14 million of cash to apply against debt on an annual basis.
Stein Mart restarted its dividend in 2013, and raised its payout by 50 percent to $0.075 in 2014. Also a $5 per share special dividend was paid in 2015.
“We continue to experience softer than planned store traffic and sales. As a result, markdowns were significantly higher for the quarter despite our focus on inventory management. Given the uncertain retail environment, we are being more conservative planning fall, keeping a higher percentage of our buying in reserve to opportunistically take advantage of any sales upside. We expect to see additional inventory reductions as the year progresses,” said Hunt Hawkins, Chief Executive Officer.
“Until we gain improved visibility during this period of weak retail apparel sales, we believe it is important to implement measures to maximize free cash flow to improve our financial position. In that regard, we have decided to suspend our quarterly dividend and significantly reduce our planned capital expenditures.”
Year-to-date Stein Mart's stock price has dropped by 69% to Wednesday's close of $1.70, leaving a market cap of just $80 million. In 2013 the stock price was trading close to $13 per share.
Stein Mart, Inc. is a national specialty and off-price retailer offering designer and name-brand fashion apparel, home décor, accessories and shoes at everyday discount prices.
Suspending the $0.075 quarterly dividend will free up approximately $14 million of cash to apply against debt on an annual basis.
Stein Mart restarted its dividend in 2013, and raised its payout by 50 percent to $0.075 in 2014. Also a $5 per share special dividend was paid in 2015.
“We continue to experience softer than planned store traffic and sales. As a result, markdowns were significantly higher for the quarter despite our focus on inventory management. Given the uncertain retail environment, we are being more conservative planning fall, keeping a higher percentage of our buying in reserve to opportunistically take advantage of any sales upside. We expect to see additional inventory reductions as the year progresses,” said Hunt Hawkins, Chief Executive Officer.
“Until we gain improved visibility during this period of weak retail apparel sales, we believe it is important to implement measures to maximize free cash flow to improve our financial position. In that regard, we have decided to suspend our quarterly dividend and significantly reduce our planned capital expenditures.”
Year-to-date Stein Mart's stock price has dropped by 69% to Wednesday's close of $1.70, leaving a market cap of just $80 million. In 2013 the stock price was trading close to $13 per share.
Stein Mart, Inc. is a national specialty and off-price retailer offering designer and name-brand fashion apparel, home décor, accessories and shoes at everyday discount prices.
