UPDATE: Stein Mart Shares Drop After Q2 Results

Shares of Stein Mart

fell more than 5% after the company reported downbeat earnings for the second quarter. The Jacksonville, Florida-based company posted quarterly net income of $1.7 million, or $0.04 per share, down from $3.4 million, or $0.08 per share, in the year-ago period. Its adjusted earnings came in at $0.06 per share, versus $0.10 per share. The recent quarter results included $2.1 million higher healthcare costs and $0.6 million higher pre-opening costs versus year-ago quarter. Its total sales rose 2.5% to $298.2 million, while comparable store sales surged 1.3% in the quarter. Analysts were expecting earnings of $0.08 per share on total sales of $300.80 million. Its adjusted earnings before interest, income taxes, depreciation and amortization came in at $44.8 million, down from $46.4 million. Stein Mart's gross profit in the quarter was $84.2 million, while selling, general and administrative expenses were $81.5 million. Cash was $53.1 million at the end of the second quarter, versus $48.1 million at the end of the year-ago quarter. Inventories at the end of the second quarter were $266.2 million, versus $250.7 million at the end of the year-ago quarter. Stein Mart is expected to open 6 new stores, relocate 4 and close 1 during the second half of the year. "Despite a challenging first half of the year with weather impacting sales, we have a number of important initiatives in place," said Jay Stein, Chief Executive Officer. Stein Mart's shares dropped 5.56% to $12.90 at 11:30 a.m. ET.