Total sales for the Jacksonville-based retailer show decline because of four store closings in first half of the year.
Stein Mart Inc. reported a net loss for the second quarter ended Aug. 4 and a slight decline in total sales, after closing four stores in the first half of the year.
However, the Jacksonville-based fashion retailer said comparable-store sales rose by 0.7 percent in the quarter.
Comparable-store sales are sales at stores open for more than a year and are considered by many analysts to be the key indicator of a retailer’s performance.
“While only slightly positive, this is a significant improvement from the decreases we saw in 2017 and is the first positive comp since the spring of 2015,” CEO Hunt Hawkins said in Stein Mart’s conference call with investors last week.
Company officials are expecting the positive sales trends to continue.
“Our initiatives are gaining traction and will continue to have a positive impact on our performance in the second half,” Hawkins said.
President MaryAnne Morin said customers are responding to “newness” in the company’s merchandise assortment.
“Across all categories, we are seeing an increase in regular priced selling due to better merchandise flow and a more relevant mix that is more modern, brand-focused and trend right,” she said.
Hawkins said sales growth will come from “the continual evolution of our product mix, our e-commerce business and our better marketing and advertising, which is reaching more potential customers and building our brand awareness.”
He also said strong inventory management is improving results.
“This has become a way of life for us now. We are keeping our inventories fresh, and lower and improved inventory productivity is resulting in higher margins,” he said.
Stein Mart recorded a net loss of $1.1 million, or 2 cents a share, for the quarter. However, it reversed an operating loss in the second quarter of 2018 with operating income of $1.8 million this year.
Total sales for the company, which operated 289 stores at the end of the quarter, were $310.9 million, compared with $311 million the previous year.
Stein Mart is projecting an operating loss of $10 million for the third quarter, but expects that to be “more than offset” by earnings in the fourth quarter.
Dick’s Wings owner makes acquisition
The owner of the Dick’s Wings & Grill chain announced an agreement Monday to buy another restaurant group as it continues expanding into other brands.
Jacksonville-based ARC Group Inc. said it is buying Fat Patty’s, a casual dining concept with four restaurants in West Virginia and Kentucky.
ARC Group agreed to pay $12.3 million for Fat Patty’s, which produced revenue of more than $11 million and net income of $700,000 last year.
This agreement follows a deal announced in June to buy the Tilted Kilt Pub Eatery chain.
ARC Group, which has 20 Dick’s Wings restaurants in Florida and Georgia, last week reported second-quarter revenue of $1.17 million. The company said the two acquisitions will increase its annual revenue to nearly $30 million.
The Fat Patty’s deal is expected to close Friday.
The company also said it plans to open two or three new Dick’s restaurants this year.
“Overall, we have built a highly scalable and profitable organization, with aggressive growth plans – both organic and through accretive acquisitions,” ARC Group President Seenu Kasturi said in a news release.
ARC Group reported a net loss of $55,531, or 1 cent a share, in the second quarter.
Web.com files proxy for vote on sale to Siris Capital Group
Wall Street continues to bet on a higher offer coming in for Web.com Group Inc., but the Jacksonville-based website services company last week filed a proxy statement for its proposed acquisition by affiliates of Siris Capital Group LLC.
The proxy asks shareholders to vote on the agreement for Siris to buy Web.com for $28 a share at a special meeting, but no date was set.
Web.com’s stock has traded at or slightly higher than $28 most of the time since the revised price was announced Aug. 6, indicating that investors are anticipating someone making a higher offer.
The proxy includes some new information, including financial projections. Web.com forecasts revenue to grow from $756 million this year to $907 million in 2022, and it projects net income of $48.6 million this year growing to $126.5 million in 2022.
The filing also shows Web.com’s total employment is 3,300, down from 3,600 at the end of 2017.
Web.com confirmed in March that it cut some jobs, but did not say how many.
Besides its Jacksonville headquarters, the company has offices in eight other U.S. cities, four in Canada and one each in the United Kingdom and Argentina.
SharedLabs says it signed contract worth $10 million
SharedLabs Inc. last week said it signed a contract worth an estimated $10 million to provide services for a large unnamed communications company.
The Jacksonville-based information technology services company, which has filed plans for an initial public offering, said the contract will be one of its 10 largest revenue streams.
The company’s latest IPO filing with the Securities and Exchange Commission showed revenue of $17.8 million in the first quarter this year.
SharedLabs employed 562 people as of July 30, according to that filing, but only a handful of those are in Jacksonville.
The company is planning to expand to bigger Downtown Jacksonville offices with the help of more than $500,000 in city and state incentives. Its incentives application said it will grow from just six Jacksonville employees and add 107 local jobs.
Medtronic reaches record high
Medtronic plc’s stock jumped to a record high last week after reporting better-than-expected sales and earnings.
Adjusted earnings of $1.17 a share for the first quarter ended July 27 were 10 cents higher than last year and 6 cents higher than the average analyst’s forecast, according to Zacks Investment Research.
Adjusted revenue of $7.38 billion was 6.8 percent higher than last year and above the average forecast of $7.23 billion.
The global medical device company said its special therapies division increased revenue by 4.1 percent to $384 million, led by mid-single digit percentage growth in its Jacksonville division, which makes surgical instruments for ear, nose and throat doctors.
The company did not give revenue figures for the ENT division.
After the earnings report, Medtronic’s stock rose $5.14 to $95.17 on Aug. 21 and reached a high of $96.50 two days later.
Analyst sees gains for Landstar System
Landstar System Inc. already is trading close to its record high, but one analyst projects more gains for the Jacksonville-based trucking company.
“We have upgraded Landstar to Outperform from Market Perform as we have become more positive on the brokerage space moving into 2019,” Wells Fargo Securities analyst Casey Deak said in a research report last week.
Landstar doesn’t own trucks but uses a network of brokers and drivers who own their own trucks to transport freight across the country.
Deak said truck freight rates seem to have peaked.
“With the data seemingly pointing to pressure on rates going forward, we believe the environment is shifting in favor of truck brokerage players who can fulfill customer freight needs and source capacity at lower rates,” he said.
Deak also said Landstar “remains the largest public provider of flatbed capacity, which continues to see leading growth in rates.”
Deak raised his price target on Landstar from $120 to $133, with the stock trading at $115.65 at the time of his report.
Landstar’s record high was $118.60 in February.