10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended October 31, 2015

or

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission file number 0-20052

STEIN MART, INC.

(Exact name of registrant as specified in its charter)

Florida	64-0466198
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)
1200 Riverplace Blvd., Jacksonville, Florida	32207
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (904) 346-1500

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	¨	Accelerated filer	x
Non-accelerated filer	¨  (Do not check if a smaller reporting company)	Smaller reporting company	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨    No  x

The number of shares outstanding of the Registrant’s common stock as of November 27, 2015 was 45,678,715.

STEIN MART, INC.

TABLE OF CONTENTS

		PAGE
PART I	FINANCIAL INFORMATION
Item 1.	Condensed Consolidated Financial Statements (Unaudited):
	Condensed Consolidated Balance Sheets		3
	Condensed Consolidated Statements of Operations		4
	Condensed Consolidated Statements of Comprehensive (Loss) Income		5
	Condensed Consolidated Statement of Shareholders’ Equity		6
	Condensed Consolidated Statements of Cash Flows		7
	Notes to Condensed Consolidated Financial Statements		8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		12
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		15
Item 4.	Controls and Procedures		15
PART II	OTHER INFORMATION
Item 1.	Legal Proceedings		15
Item 1A.	Risk Factors		15
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		16
Item 3.	Defaults Upon Senior Securities		16
Item 4.	Mine Safety Disclosures		16
Item 5.	Other Information		16
Item 6.	Exhibits		16
SIGNATURES			17

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Stein Mart, Inc.

Condensed Consolidated Balance Sheets

(Unaudited)

(In thousands, except for share and per share data)

	October 31, 2015			January 31, 2015			November 1, 2014
ASSETS
Current assets:
Cash and cash equivalents	$	14,126		$	65,314		$	64,882
Inventories		372,912			285,623			343,721
Prepaid expenses and other current assets		34,681			22,733			29,840
Total current assets		421,719			373,670			438,443
Property and equipment, net of accumulated depreciation and amortization of $185,520, $166,646 and $168,557, respectively		162,907			148,782			150,646
Other assets		30,323			30,639			31,005
Total assets	$	614,949		$	553,091		$	620,094
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	202,176		$	129,924		$	214,635
Current portion of debt		10,000			—			—
Accrued expenses and other current liabilities		68,162			69,213			63,332
Total current liabilities		280,338			199,137			277,967
Long-term debt		181,833			—			—
Deferred rent		41,163			31,284			32,063
Other liabilities		39,355			37,732			36,211
Total liabilities		542,689			268,153			346,241
COMMITMENTS AND CONTINGENCIES
Shareholders’ equity:
Preferred stock - $.01 par value; 1,000,000 shares authorized; no shares issued or outstanding
Common stock - $.01 par value; 100,000,000 shares authorized; 45,675,579, 44,918,649 and 44,945,280 shares issued and outstanding, respectively		457			449			449
Additional paid-in capital		41,826			34,875			32,532
Retained earnings		30,397			250,046			241,125
Accumulated other comprehensive loss		(420	)		(432	)		(253	)
Total shareholders’ equity		72,260			284,938			273,853
Total liabilities and shareholders’ equity	$	614,949		$	553,091		$	620,094

The accompanying notes are an integral part of these condensed consolidated financial statements.

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Stein Mart, Inc.

Condensed Consolidated Statements of Operations

(Unaudited)

(In thousands, except per share amounts)

	13 Weeks Ended			13 Weeks Ended			39 Weeks Ended		39 Weeks Ended
	October 31, 2015			November 1, 2014			October 31, 2015		November 1, 2014
Net sales	$	300,665		$	303,667		$	965,769	$	930,678
Cost of merchandise sold		218,497			219,106			686,286		657,547
Gross profit		82,168			84,561			279,483		273,131
Selling, general and administrative expenses		81,464			86,277			248,631		248,957
Operating income (loss)		704			(1,716	)		30,852		24,174
Interest expense, net		891			66			2,384		200
(Loss) income before income taxes		(187	)		(1,782	)		28,468		23,974
Income tax expense (benefit)		10			(571	)		11,007		9,373
Net (loss) income	$	(197	)	$	(1,211	)	$	17,461	$	14,601
Net (loss) income per share:
Basic	$	(0.01	)	$	(0.03	)	$	0.39	$	0.33
Diluted	$	(0.01	)	$	(0.03	)	$	0.37	$	0.32
Weighted-average shares outstanding:
Basic		44,791			43,857			44,704		43,833
Diluted		44,791			43,857			45,916		44,664
Dividends declared per common share	$	0.075		$	0.075		$	5.225	$	0.20

The accompanying notes are an integral part of these condensed consolidated financial statements.

4

Stein Mart, Inc.

Condensed Consolidated Statements of Comprehensive (Loss) Income

(Unaudited)

(In thousands)

	13 Weeks Ended			13 Weeks Ended			39 Weeks Ended		39 Weeks Ended
	October 31, 2015			November 1, 2014			October 31, 2015		November 1, 2014
Net (loss) income	$	(197	)	$	(1,211	)	$	17,461	$	14,601
Other comprehensive income, net of tax:
Amounts reclassified from accumulated other comprehensive income		4			3			12		8
Comprehensive (loss) income	$	(193	)	$	(1,208	)	$	17,473	$	14,609

The accompanying notes are an integral part of these condensed consolidated financial statements.

5

Stein Mart, Inc.

Condensed Consolidated Statement of Shareholders’ Equity

(Unaudited)

(In thousands, except per share amounts)

													Accumulated
							Additional						Other			Total
	Common Stock						Paid-in			Retained			Comprehensive			Shareholders’
	Shares			Amount			Capital			Earnings			Loss			Equity
Balance at January 31, 2015		44,919		$	449		$	34,875		$	250,046		$	(432	)	$	284,938
Net income											17,461						17,461
Other comprehensive income, net of tax														12			12
Common shares issued under stock option plan		70			1			203									204
Common shares issued under employee stock purchase plan		40			—			358									358
Reacquired shares		(214	)		(2	)		(3,210	)								(3,212	)
Issuance of restricted stock, net		861			9			(9	)								—
Share-based compensation								5,773									5,773
Tax benefit from equity issuances								3,836									3,836
Cash dividends paid ($5.225 per share)											(235,691	)					(235,691	)
Cash dividends payable											(1,419	)					(1,419	)
Balance at October 31, 2015		45,676		$	457		$	41,826		$	30,397		$	(420	)	$	72,260

The accompanying notes are an integral part of these condensed consolidated financial statements.

6

Stein Mart, Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(In thousands)

	39 Weeks Ended			39 Weeks Ended
	October 31, 2015			November 1, 2014
Cash flows from operating activities:
Net income	$	17,461		$	14,601
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		22,050			21,709
Share-based compensation		5,773			5,492
Store closing charges		7			1,163
Impairment of property and other assets		—			96
Loss on disposal of property and equipment		53			121
Deferred income taxes		(809	)		1,399
Tax benefit from equity issuances		3,836			756
Excess tax benefits from share-based compensation		(3,875	)		(879	)
Changes in assets and liabilities:
Inventories		(87,289	)		(82,204	)
Prepaid expenses and other current assets		(12,181	)		(4,278	)
Other assets		603			(3,591	)
Accounts payable		71,617			83,446
Accrued expenses and other current liabilities		(2,177	)		(1,729	)
Other liabilities		11,226			6,477
Net cash provided by operating activities		26,295			42,579
Cash flows from investing activities:
Net acquisition of property and equipment		(34,470	)		(34,043	)
Net cash used in investing activities		(34,470	)		(34,043	)
Cash flows from financing activities:
Proceeds from borrowings		533,334			—
Repayments of debt		(341,501	)		—
Debt issuance costs		(380	)		—
Cash dividends paid		(235,691	)		(8,929	)
Excess tax benefits from share-based compensation		3,875			879
Proceeds from exercise of stock options and other		562			427
Repurchase of common stock		(3,212	)		(2,885	)
Net cash used in financing activities		(43,013	)		(10,508	)
Net decrease in cash and cash equivalents		(51,188	)		(1,972	)
Cash and cash equivalents at beginning of year		65,314			66,854
Cash and cash equivalents at end of period	$	14,126		$	64,882
Supplemental disclosures of cash flow information:
Income taxes paid	$	12,304		$	8,802
Interest paid		2,130			273
Purchases of property and equipment included in accounts payable, accrued expenses and other current liabilities at period end		4,051			1,356

The accompanying notes are an integral part of these condensed consolidated financial statements.

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STEIN MART, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in tables in thousands, except per share amounts)

1. Basis of Presentation

The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting primarily of normal and recurring adjustments) considered necessary for fair presentation of the Condensed Consolidated Financial Statements have been included. Due to the seasonality of our business, results for any quarter are not necessarily indicative of the results that may be achieved for a full fiscal year. For further information, refer to the Consolidated Financial Statements and footnotes thereto included in our annual report on Form 10-K for the year ended January 31, 2015.

As used herein, the terms “we,” “our,” “us,” “Stein Mart” and the “Company” refer to Stein Mart, Inc. and its wholly-owned subsidiaries.

Recent Accounting Pronouncements

In 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606). ASU No. 2014-09 provides a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. ASU No. 2014-09 will require an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This update creates a five-step model that requires entities to exercise judgment when considering the terms of the contract(s) which include (i) identifying the contract(s) with the customer, (ii) identifying the separate performance obligations in the contract, (iii) determining the transaction price, (iv) allocating the transaction price to the separate performance obligations, and (v) recognizing revenue when each performance obligation is satisfied. This guidance was deferred by ASU No. 2015-14, issued by the FASB in August 2015, and is effective for annual and interim reporting periods beginning after December 15, 2017, with early adoption permitted for annual and interim reporting periods beginning after December 15, 2016. The Company has the option to apply the provisions of ASU No. 2014-09 either retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of applying this ASU recognized at the date of initial application. The Company is currently evaluating the impact the adoption of this ASU will have on the Company’s consolidated financial statements.

In 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205-40). ASU No. 2014-15 requires management to perform interim and annual assessments on whether there are conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year of the date the financial statements are issued and to provide related disclosures, if required. ASU No. 2014-15 applies to all entities and is effective for annual periods ending after December 15, 2016, and interim periods within annual periods beginning after December 15, 2016. Early application is permitted for annual or interim reporting periods for which the financial statements have not previously been issued. The adoption of ASU No. 2014-15 is not expected to have a material effect on the Company’s consolidated financial statements.

In April 2015, the FASB issued ASU No. 2015-03, Interest – Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. ASU No. 2015-03 states that entities that have historically presented debt issuance costs as an asset, related to a recognized debt liability, will be required to present those costs as a direct deduction from the carrying amount of that debt liability. This presentation will result in debt issuance cost being presented the same way debt discounts have historically been handled. ASU No. 2015-03 does not change the recognition, measurement, or subsequent measurement guidance for debt issuance costs. This guidance is effective for annual reporting periods beginning after December 15, 2016, and interim periods within annual reporting periods beginning after December 15, 2016. Early adoption is permitted. The Company expects this new guidance will reduce total assets and total long-term debt on its consolidated balance sheets by amounts classified as deferred debt issuance costs, but does not expect this Update to have any other effect on its consolidated financial statements.

In April 2015, the FASB issued ASU No. 2015-05, Intangibles – Goodwill and Other – Internal Use Software (Subtopic 350-40). The pronouncement was issued to provide guidance concerning accounting for fees in a cloud computing arrangement. The pronouncement is effective for reporting periods beginning after December 15, 2015. The adoption of ASU 2015-05 is not expected to have a significant impact on the Company’s consolidated financial statements.

In November 2015, the FASB issued ASU No. 2015-17, Income Taxes – Balance Sheet Classification of Deferred Taxes (Subtopic 740). The pronouncement was issued to simplify the presentation of deferred income taxes by requiring that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. The current requirement that deferred tax liabilities and assets of a

8

tax-paying component of an entity be offset and presented as a single amount is not affected by the amendments in this Update. The pronouncement is effective for reporting periods beginning after December 15, 2016. Early application is permitted as of the beginning of an interim or annual period. The Company expects this new guidance will reduce total assets and total liabilities on its consolidated balance sheets as amounts will now be presented net in a single line item. The adoption of ASU 2015-17 is not expected to have any additional impact on the Company’s consolidated financial statements.

2. Accrued Expenses and Other Current Liabilities

The major components of accrued expenses and other current liabilities are as follows:

	October 31,		January 31,		November 1,
	2015		2015		2014
Compensation and employee benefits	$	10,141	$	12,519	$	9,758
Unredeemed gift and merchandise return cards		7,708		10,614		6,786
Property taxes		14,179		12,805		13,176
Accrued vacation		7,241		7,241		6,976
Other		28,893		26,034		26,636
Accrued expenses and other current liabilities	$	68,162	$	69,213	$	63,332

3. Fair Value Measurements

We have historically had money market fund investments classified as cash equivalents, which are Level 1 assets because fair value is based on readily available market prices. The fair value of these assets was $53.7 million at January 31, 2015 and $50.2 million at November 1, 2014. We did not have money market fund investments at October 31, 2015.

As the Company’s primary debt obligations are variable rate, there are no significant differences between the estimated fair value (Level 2 measurements) and the carrying value of the Company’s debt obligations at October 31, 2015. The Company did not have outstanding debt at January 31, 2015 and November 1, 2014.

4. Debt

On February 3, 2015, we entered into a $250 million senior secured revolving credit facility pursuant to a second amended and restated credit agreement with Wells Fargo Bank (the “Credit Agreement”) that will mature in February 2020 and a secured $25 million master loan agreement with Wells Fargo Equipment Finance, Inc. (the “Equipment Term Loan” and, together with the Credit Agreement, the “Credit Facilities”) that will mature in February 2018. The Credit Facilities replace the Company’s former $100 million senior secured revolving credit facility which was set to mature on February 28, 2017. Borrowings under the Credit Facilities were initially used for a special dividend, but subsequently may be used for working capital, capital expenditures and other general corporate purposes. During 2015, debt issuance costs associated with the Credit Facilities were capitalized in the amount of $0.4 million and will be amortized over their respective terms.

Long-term debt consisted of the following at October 31, 2015:

Revolving credit facility	$	168,500
Equipment term loan		23,333
Total debt		191,833
Current maturities		(10,000	)
Long-term debt	$	181,833

The aggregate maturities of long-term debt subsequent to October 31, 2015 for the following fiscal years:

2015	$	2,500
2016		10,000
2017		10,833
2018		—
2019		—
Thereafter		168,500
Total	$	191,833

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The total amount available under the Credit Agreement is the lesser of the Aggregate Commitment or 100% of eligible credit card receivables and the Net Recovery Percentage of inventories less reserves. At October 31, 2015, in addition to outstanding borrowings under the Credit Agreement, the Company had $6.4 million of outstanding letters of credit, which reduced the Company’s availability under the Credit Agreement to $75.1 million.

The Credit Facilities contain customary representations and warranties, affirmative and negative covenants (including, in the Credit Agreement, the requirement of a 1 to 1 consolidated fixed charge coverage ratio upon the occurrence and during the continuance of any Covenant Compliance Event, as defined in the Credit Agreement), and events of default for facilities of this type and are cross-collateralized and cross-defaulted. Collateral for the Credit Facilities consists of substantially all of our personal property. Wells Fargo Bank has a first lien on all collateral other than equipment and Wells Fargo Equipment Finance has a first lien on equipment. At October 31, 2015, the Company was in compliance with all debt covenants.

Borrowings under the Credit Agreement shall be either Base Rate Loans or LIBO Rate Loans. LIBO Rate Loans bear interest equal to the Adjusted LIBO Rate plus the Applicable Margin (125 to 175 basis points) depending on the Quarterly Average Excess Availability. Base Rate Loans bear interest equal to the highest of (a) the Federal Funds Rate plus one-half of one percent (0.50%), (b) the Adjusted LIBO Rate plus one percent (1.00%), or (c) the Wells Fargo “prime rate,” plus the Applicable Margin (25 to 75 basis points).

Borrowings under the Equipment Term Loan shall be LIBO Rate plus 2%.

The weighted average interest rate for amounts outstanding under the Credit Agreement and Equipment Term Loan were 1.74 percent and 2.19 percent, respectively, as of October 31, 2015.

5. Shareholders’ Equity

Dividends

During 2015, we paid a special cash dividend of $5.00 per common share on February 27, 2015 and three quarterly dividends of $0.075 per common share on April 17, 2015, July 17, 2015 and October 16, 2015. In 2014, we paid quarterly dividends of $0.05 per common share on April 18, 2014 and $0.075 per common share on July 18, 2014 and October 17, 2014.

On December 9, 2015, the Board of Directors declared a dividend of $0.075 per common share to be paid on January 15, 2016 to shareholders of record on December 31, 2015.

Stock Repurchase Plan

During the 39 weeks ended October 31, 2015, we repurchased 213,815 shares of our common stock at a total cost of $3.2 million. During the 39 weeks ended November 1, 2014, we repurchased 228,553 shares of our common stock at a total cost of $2.9 million. Stock repurchases were for tax withholding amounts due on the vesting of employee stock awards and during the first nine months of 2015 did not include any shares purchased on the open market under our previously authorized stock repurchase plan. As of October 31, 2015, there are 269,295 shares that can be repurchased pursuant to the Board of Director’s current authorization. In November 2015, the Board of Directors authorized the repurchase of 500,000 shares of our common stock in addition to amounts previously authorized.

6. Earnings Per Share

We calculate earnings per common share (“EPS”) using the two-class method. Unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are participating securities and are included in the computation of EPS. Our restricted stock awards in 2013 and prior are considered “participating securities” because they contain non-forfeitable rights to dividends.

10

The following table presents the calculation of basic and diluted EPS (shares in thousands):

	13 Weeks Ended			13 Weeks Ended			39 Weeks Ended		39 Weeks Ended
	October 31, 2015			November 1, 2014			October 31, 2015		November 1, 2014
Basic (Loss) Earnings Per Common Share:
Net (loss) income	$	(197	)	$	(1,211	)	$	17,461	$	14,601
Income allocated to participating securities		26			—			205		268
Net (loss) income available to common shareholders	$	(223	)	$	(1,211	)	$	17,256	$	14,333
Basic weighted-average shares outstanding		44,791			43,857			44,704		43,833
Basic (loss) earnings per share	$	(0.01	)	$	(0.03	)	$	0.39	$	0.33
Diluted (Loss) Earnings Per Common Share:
Net (loss) income	$	(197	)	$	(1,211	)	$	17,461	$	14,601
Income allocated to participating securities		26			—			255		266
Net (loss) income available to common shareholders	$	(223	)	$	(1,211	)	$	17,206	$	14,335
Basic weighted-average shares outstanding		44,791			43,857			44,704		43,833
Incremental shares from share-based compensation plans		—			—			1,212		831
Diluted weighted-average shares outstanding		44,791			43,857			45,916		44,664
Diluted (loss) earnings per share	$	(0.01	)	$	(0.03	)	$	0.37	$	0.32

Due to the Company’s net loss position for the third quarter of 2015 and 2014, 0.4 million and 0.8 million weighted average unvested restricted shares (participating securities) and 1.3 million and 1.0 million weighted average common stock equivalents (non-participating securities), respectively, were not considered in the calculation of net loss available to common shareholders used for both basic and diluted EPS for the quarter.

In addition, options to acquire shares totaling approximately 0.4 million shares of common stock that were outstanding during each of the third quarters of 2015 and 2014 were not included in the computation of diluted earnings per common share. Options excluded were those that had exercise prices greater than the average market price of the common shares such that inclusion would have been anti-dilutive. For the first nine months of 2015 and 2014, options to acquire shares of approximately 0.2 million and 0.3 million shares of common stock, respectively, were not included in the computation of diluted earnings per share for the aforementioned reasons.

7. Commitments and Contingencies

On July 24, 2013, the Securities and Exchange Commission (the “SEC”) informed us that it was conducting an investigation of the Company and made a request for voluntary production of documents and information. The request was focused on our restatement of 2012 and prior consolidated financial statements and our 2013 change in auditors. In an administrative proceeding, the SEC found that the Company had violated the reporting, books and records, and internal controls provisions of the Securities Exchange Act of 1934 during the restatement period and ordered the Company to cease and desist from committing or causing any violations and any future violations of such SEC rules. In September 2015, the Company agreed to a settlement with the SEC without admitting or denying the findings of the SEC and also agreed to pay a civil monetary penalty of $0.8 million. The Company previously established a reserve for the potential settlement of this matter, which did not require significant adjustment in the third quarter of 2015. The Company recognized $0.2 million and $2.9 million of expenses, net of expected insurance recoveries, related to the SEC investigation during the 39 weeks ended October 31, 2015 and November 1, 2014, respectively.

The SEC did not allege fraud by the Company and did not bring charges against any individual. In connection with the settlement, the SEC considered remedial acts undertaken by the Company, including its enhancement of internal controls, retention of additional accounting personnel, and the Company’s cooperation with the SEC staff during the course of the investigation.

We are involved in various routine legal proceedings incidental to the conduct of our business. Management, based upon the advice of outside legal counsel, does not believe that any of these legal proceedings will have a material adverse effect on our financial condition, results of operations or cash flows.

11

STEIN MART, INC.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

As used herein, the terms “we,” “our,” “us,” “Stein Mart” and the “Company” refer to Stein Mart, Inc. and its wholly-owned subsidiaries.

Forward-Looking Statements

This report contains forward-looking statements which are subject to certain risks, uncertainties or assumptions and may be affected by certain factors including, but not limited to, the matters discussed in “Item 1A. Risk Factors” of our Form 10-K for the fiscal year ended January 31, 2015. Wherever used, the words “plan,” “expect,” “anticipate,” “believe,” “estimate” and similar expressions identify forward-looking statements. Should one or more of these risks, uncertainties or other factors materialize, or should underlying assumptions prove incorrect, actual results, performance or achievements may vary materially from any future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements are based on beliefs and assumptions of our management and on information currently available to such management. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to publicly update or revise our forward-looking statements in light of new information or future events. Undue reliance should not be placed on such forward-looking statements, which are based on current expectations. Forward-looking statements are not guarantees of performance.

Overview

We are a national retailer offering the fashion merchandise, service and presentation of a better department or specialty store at prices comparable to off-price retail chains. Our focused assortment of merchandise features current-season moderate to better fashion apparel for women and men, as well as accessories, shoes and home fashions.

Financial Overview for the 13 and 39 weeks ended October 31, 2015

• Net sales were $300.7 million for the 13 weeks ended October 31, 2015, a decrease from $303.7 million for the 13 weeks ended November 1, 2014, and $965.8 million for the 39 weeks ended October 31, 2015, an increase from $930.7 million for the 39 weeks ended November 1, 2014.

• Comparable store sales for the 13 weeks ended October 31, 2015 decreased 2.3 percent compared to the 13 weeks ended November 1, 2014, and for the 39 weeks ended October 31, 2015 increased 1.9 percent compared to the 39 weeks ended November 1, 2014.

• Net loss was $0.2 million or $0.01 loss per diluted share for the 13 weeks ended October 31, 2015, compared to net loss of $1.2 million or $0.03 loss per diluted share for the 13 weeks ended November 1, 2014.

• Net income was $17.5 million or $0.37 per diluted share for the 39 weeks ended October 31, 2015 compared to net income of $14.6 million or $0.32 per diluted share for the 39 weeks ended November 1, 2014.

• On February 27, 2015, the Company paid a special cash dividend of $5.00 per common share. The payment made in connection with this dividend was approximately $226 million, and was funded by existing cash and initial borrowings of $185 million on our $275 million Credit Facilities.

• We had $191.8 million of borrowings on our Credit Facilities as of October 31, 2015 and no borrowings as of January 31, 2015 and November 1, 2014.

Stores

The following table sets forth the stores activity for the 13 and 39 weeks ended October 31, 2015 and November 1, 2014.

	13 Weeks Ended		13 Weeks Ended			39 Weeks Ended			39 Weeks Ended
	October 31, 2015		November 1, 2014			October 31, 2015			November 1, 2014
Stores at beginning of period		269		265			270			264
Stores opened during the period		5		4			6			7
Stores closed during the period		—		(1	)		(2	)		(3	)
Stores at the end of period		274		268			274			268

12

Results of Operations

The following table sets forth each line item of our Condensed Consolidated Statements of Operations expressed as a percentage of net sales:

	13 Weeks Ended			13 Weeks Ended			39 Weeks Ended			39 Weeks Ended
	October 31, 2015			November 1, 2014			October 31, 2015			November 1, 2014
Net sales		100.0	%		100.0	%		100.0	%		100.0	%
Cost of merchandise sold		72.7	%		72.2	%		71.1	%		70.7	%
Gross profit		27.3	%		27.8	%		28.9	%		29.3	%
Selling, general and administrative expenses		27.1	%		28.4	%		25.7	%		26.7	%
Operating income (loss)		0.2	%		(0.6	)%		3.2	%		2.6	%
Interest expense, net		0.3	%		0.0	%		0.2	%		0.0	%
(Loss) income before income taxes		(0.1	)%		(0.6	)%		3.0	%		2.6	%
Income tax expense (benefit)		0.0	%		(0.2	)%		1.2	%		1.0	%
Net (loss) income		(0.1	)%		(0.4	)%		1.8	%		1.6	%

Thirteen and Thirty-Nine Weeks Ended October 31, 2015, Compared to the Thirteen and Thirty-Nine Weeks Ended November 1, 2014 (dollar amounts in thousands):

Net Sales

	13 Weeks Ended		13 Weeks Ended					39 Weeks Ended		39 Weeks Ended
	October 31, 2015		November 1, 2014		Decrease			October 31, 2015		November 1, 2014		Increase
Net sales	$	300,665	$	303,667	$	(3,002	)	$	965,769	$	930,678	$	35,091
Sales percent (decrease) increase:
Total net sales						(1.0	)%						3.8	%
Comparable store sales						(2.3	)%						1.9	%

The decrease in comparable stores sales for the 13 weeks ended October 31, 2015, was driven by a decrease in transactions and units per transaction, partially offset by an increase in average unit retail prices. Comparable store sales reflect stores open throughout the period and prior fiscal year and include e-commerce sales. E-commerce sales contributed approximately 0.6 percent to the comparable store sales for the 13 weeks ended October 31, 2015. Comparable store sales do not include leased department commissions.

For the 39 weeks ended October 31, 2015, the increase in comparable store sales was driven by increases in the number of transactions and average unit retail prices. E-commerce sales contributed approximately 0.7 percent to the comparable store sales for the 39 weeks ended October 31, 2015.

Gross Profit

	13 Weeks Ended			13 Weeks Ended						39 Weeks Ended			39 Weeks Ended			Increase/
	October 31, 2015			November 1, 2014			Decrease			October 31, 2015			November 1, 2014			(Decrease)
Gross profit	$	82,168		$	84,561		$	(2,393	)	$	279,483		$	273,131		$	6,352
Percentage of net sales		27.3	%		27.8	%		(0.5	)%		28.9	%		29.3	%		(0.4	)%

For the 13 and 39 weeks ended October 31, 2015, gross profit as a percent of sales decreased as a result of higher occupancy costs, primarily due to increased costs for renewed leases and new stores.

For the 13 weeks ended October 31, 2015, the higher occupancy costs were partially offset by lower allocation of buying and distribution expense.

13

Selling, General and Administrative Expenses (“SG&A”)

	13 Weeks Ended			13 Weeks Ended						39 Weeks Ended			39 Weeks Ended
	October 31, 2015			November 1, 2014			Decrease			October 31, 2015			November 1, 2014			Decrease
Selling, general and administrative expenses	$	81,464		$	86,277		$	(4,813	)	$	248,631		$	248,957		$	(326	)
Percentage of net sales		27.1	%		28.4	%		(1.3	)%		25.7	%		26.7	%		(1.0	)%

For the 13 weeks ended October 31, 2015, SG&A expenses as a percentage of sales decreased primarily due to lower professional fees related to the SEC investigation, as well as decreased earnings-based incentive compensation expense, store closing charges, and store operating expenses.

For the 39 weeks ended October 31, 2015, SG&A expenses as a percentage of sales decreased primarily due to lower professional fees related to the SEC investigation, store closing charges, and healthcare costs, as well as better leverage of store operating expenses, and are partially offset by higher e-commerce costs.

Interest Expense

	13 Weeks Ended			13 Weeks Ended						39 Weeks Ended			39 Weeks Ended
	October 31, 2015			November 1, 2014			Increase			October 31, 2015			November 1, 2014			Increase
Interest expense	$	891		$	66		$	825		$	2,384		$	200		$	2,184
Percentage of net sales		0.3	%		0.0	%		0.3	%		0.2	%		0.0	%		0.2	%

Interest expense increased for the 13 and 39 weeks ended October 31, 2015 due to borrowings in 2015 on our Credit Facilities. Borrowings under the Credit Facilities were initially used to pay a $5 per share special dividend, but were subsequently used for working capital, capital expenditures and other general corporate purposes.

Income Taxes

	13 Weeks Ended			13 Weeks Ended						39 Weeks Ended			39 Weeks Ended			Increase/
	October 31, 2015			November 1, 2014			Increase			October 31, 2015			November 1, 2014			(Decrease)
Income tax expense (benefit)	$	10		$	(571	)	$	581		$	11,007		$	9,373		$	1,634
Effective tax rate		5.3	%		(32.0	)%		37.3	%		38.7	%		39.1	%		(0.4	)%

Our effective tax rate represents the applicable combined federal and state statutory rates reduced by the federal benefit of state taxes deductible on federal returns, adjusted for the impact of permanent differences. The effective rate is impacted by changes in law, location of new stores, level of earnings, and the resolution of tax positions with various taxing authorities. The effective tax rate for the thirteen weeks ended October 31, 2015 was impacted by discrete items recognized in the third quarter of fiscal 2015.

Liquidity and Capital Resources

Capital requirements and working capital needs are funded through a combination of internally generated funds, available cash, credit terms from vendors, and our $250 million senior secured revolving credit facility pursuant to a second amended and restated credit agreement with Wells Fargo Bank. See Note 4 of the Condensed Consolidated Financial Statements for further discussion. Working capital is used to support store inventories and capital investments for system improvements, new store openings and to maintain existing stores. Historically, our investments in working capital are lowest in August and September, after our heavy spring selling season and in February after the holiday selling season. Investments in working capital are highest in April, October and November as we begin procuring and paying for merchandise to support our heavy spring and holiday seasons. As of October 31, 2015, we had cash and cash equivalents of $14.1 million and $191.8 million in borrowings under our Credit Facilities.

Net cash provided by operating activities was $26.3 million for the 39 weeks ended October 31, 2015 compared to net cash provided by operating activities of $42.6 million for the 39 weeks ended November 1, 2014. The decrease in cash provided by operating activities was primarily due to increased investments in inventory, additional tax payments, and changes in accounts payables, partially offset by higher net income and other non-cash changes.

Net cash used in investing activities is for capital expenditures and was $34.5 million for the 39 weeks ended October 31, 2015, which was comparable to $34.0 million for the 39 weeks ended November 1, 2014.

14

Net cash used in financing activities was $43.0 million for the 39 weeks ended October 31, 2015 compared to cash used in financing activities of $10.5 million for the 39 weeks ended November 1, 2014. During 2015, we had proceeds from borrowings of $533.3 million and repayments of debt for $341.5 million. Borrowings under the Credit Facilities were initially used to pay a $5 per share special dividend, but were subsequently used for working capital, capital expenditures and other general corporate purposes. We paid cash dividends of $235.7 million during the 39 weeks ended October 31, 2015. See Note 5 of the Notes to the Condensed Consolidated Financial Statements for further discussion. In addition, we repurchased shares of common stock for $3.2 million and received excess tax benefits from share-based compensation of $3.9 million. During 2014, we paid cash dividends of $8.9 million, repurchased shares of common stock for $2.9 million, and received excess tax benefits from share-based compensation of $0.9 million.

Critical Accounting Policies and Estimates

We discuss our critical accounting policies and estimates in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” in our Annual Report on Form 10-K for the year ended January 31, 2015. We have made no significant change in our critical accounting policies since January 31, 2015.

Recent Accounting Pronouncement

Recently issued accounting pronouncements are discussed in Note 1 of the Notes to the Condensed Consolidated Financial Statements.

Seasonality and Inflation

Our business is seasonal. Sales and profitability are historically higher in the first and fourth quarters of the fiscal year, which include the spring and holiday seasons. Therefore, results for any quarter are not necessarily indicative of the results that may be achieved for a full fiscal year.

Although we expect that our operations will be influenced by general economic conditions, we do not believe that inflation has had a material effect on our results of operations. However, there can be no assurance that our business will not be affected by such factors in the future.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

For information regarding our exposure to certain market risk, see “Quantitative and Qualitative Disclosures about Market Risk” in Part II, Item 7A of our annual report on Form 10-K for the year ended January 31, 2015. There were no material changes to our market risk during the quarter ended October 31, 2015.

ITEM 4. CONTROLS AND PROCEDURES

Under the supervision and with the participation of our management, including the Chief Executive Officer and Chief Financial Officer, we have evaluated the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as of the end of the period covered by this report. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective as of October 31, 2015 to provide reasonable assurance that information required to be disclosed in our reports under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management as appropriate to allow timely decisions regarding required disclosure.

There were no changes in the Company’s internal control over financial reporting (as that term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Legal proceedings are discussed in Note 7 of the Notes to the Condensed Consolidated Financial Statements.

ITEM 1A. RISK FACTORS

With respect to our risk factor titled “The Securities and Exchange Commission (the “SEC”) Investigation could materially and adversely affect our business, our financial condition and results of operations,” we note that the Company entered into a settlement with the SEC in September 2015. See Note 7of the Notes to the Condensed Consolidated Financial Statements. Other than the change described above, there have been no significant changes in our risk factors from those described in our annual report on Form 10-K for the year ended January 31, 2015.

15

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The following table provides information regarding repurchases of our common stock during the quarter ended October 31, 2015:

ISSUER PURCHASES OF EQUITY SECURITIES
Period	Total number of shares purchased		Average price paid per share		Total number of shares purchased as part of publicly announced plans or programs (1)		Maximum number of shares that may yet be purchased under the plans or programs (1)
August 2, 2015 - August 29, 2015		10,162	$	10.44		10,162		273,975
August 30, 2015 - October 3, 2015		1,803		10.09		1,803		272,172
October 4, 2015 - October 31, 2015		2,877		8.85		2,877		269,295
Total		14,842	$	10.09		14,842		269,295

(1) Our Open Market Repurchase Program is conducted pursuant to authorizations made from time to time by our Board of Directors. On November 24, 2015, our Board of Directors authorized an additional 500,000 shares for repurchase under our Open Market Repurchase Program.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

Not applicable.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM  5. OTHER INFORMATION

Not applicable.

ITEM 6. EXHIBITS

10.1 Employment Agreement, dated September 15, 2015, between Stein Mart, Inc. and David H. Hawkins, incorporated by reference to the Company’s Current Report on Form 8-K dated September 15, 2015

31.1 Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) or 15d-14(a)

31.2 Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) or 15d-14(a)

32.1 Certification of the Chief Executive Officer Pursuant to 18 U.S.C. Section 1350

32.2 Certification of the Chief Financial Officer Pursuant to 18 U.S.C. Section 1350

101 Interactive data files from Stein Mart, Inc.’s Quarterly Report on Form 10-Q for the quarter ended October 31, 2015, formatted in XBRL (eXtensible Business Reporting Language): (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Income, (iii) the Condensed Consolidated Statements of Comprehensive Income, (iv) the Condensed Consolidated Statement of Shareholders’ Equity, (v) the Condensed Consolidated Statements of Cash Flows, and (vi) the Notes to Condensed Consolidated Financial Statements

16

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Form 10-Q to be signed on its behalf by the undersigned thereunto duly authorized.

	STEIN MART, INC.
Date: December 9, 2015	By:	/s/ Jay Stein
		Jay Stein
		Chairman of the Board and Chief Executive Officer
		/s/ Gregory W. Kleffner
		Gregory W. Kleffner
		Executive Vice President and Chief Financial Officer

17

EX-31.1

Exhibit 31.1

Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) or 15d-14(a)

I, Jay Stein, certify that:

1. I have reviewed this report on Form 10-Q of Stein Mart, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: December 9, 2015	/s/ Jay Stein
	Jay Stein
	Chairman of the Board and Chief Executive Officer

EX-31.2

Exhibit 31.2

Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) or 15d-14(a)

I, Gregory W. Kleffner, certify that:

1. I have reviewed this report on Form 10-Q of Stein Mart, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: December 9, 2015	/s/ Gregory W. Kleffner
	Gregory W. Kleffner
	Executive Vice President and Chief Financial Officer

EX-32.1

Exhibit 32.1

Certification of the Chief Executive Officer Pursuant to 18 U.S.C. Section 1350

In connection with the Quarterly Report on Form 10-Q for the fiscal quarter ended October 31, 2015 of Stein Mart, Inc. (the “Form 10-Q”), I, Jay Stein, Chairman of the Board and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Form 10-Q fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: December 9, 2015	/s/ Jay Stein
	Jay Stein
	Chairman of the Board and Chief Executive Officer

EX-32.2

Exhibit 32.2

Certification of the Chief Financial Officer Pursuant to 18 U.S.C. Section 1350

In connection with the Quarterly Report on Form 10-Q for the fiscal quarter ended October 31, 2015 of Stein Mart, Inc. (the “Form 10-Q”), I, Gregory W. Kleffner, Executive Vice President and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Form 10-Q fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: December 9, 2015	/s/ Gregory W. Kleffner
	Gregory W. Kleffner
	Executive Vice President and Chief Financial Officer

XML

Shareholders' Equity - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Millions									3 Months Ended		9 Months Ended
	Dec. 09, 2015	Oct. 16, 2015	Jul. 17, 2015	Apr. 17, 2015	Feb. 27, 2015	Oct. 17, 2014	Jul. 18, 2014	Apr. 18, 2014	Oct. 31, 2015	Nov. 01, 2014	Oct. 31, 2015	Nov. 01, 2014	Nov. 30, 2015
Schedule of Shareholders' Equity [Line Items]
Dividend declared and cash paid per share		$ 0.075	$ 0.075	$ 0.075	$ 5.00	$ 0.075	$ 0.075	$ 0.050			$ 5.225
Dividend to be paid for common shares	$ 0.075								$ 0.075	$ 0.075	$ 5.225	$ 0.200
Repurchase of shares											213,815	228,553
Repurchase shares value											$ 3.2	$ 2.9
Board of Directors [Member]
Schedule of Shareholders' Equity [Line Items]
Repurchase of shares											0
Repurchase of shares, remaining									269,295		269,295
Common shares authorized to repurchase													500,000

XML

Basis of Presentation

9 Months Ended

Oct. 31, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

1. Basis of Presentation

The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting primarily of normal and recurring adjustments) considered necessary for fair presentation of the Condensed Consolidated Financial Statements have been included. Due to the seasonality of our business, results for any quarter are not necessarily indicative of the results that may be achieved for a full fiscal year. For further information, refer to the Consolidated Financial Statements and footnotes thereto included in our annual report on Form 10-K for the year ended January 31, 2015.

As used herein, the terms “we,” “our,” “us,” “Stein Mart” and the “Company” refer to Stein Mart, Inc. and its wholly-owned subsidiaries.

Recent Accounting Pronouncements

In 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606). ASU No. 2014-09 provides a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. ASU No. 2014-09 will require an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This update creates a five-step model that requires entities to exercise judgment when considering the terms of the contract(s) which include (i) identifying the contract(s) with the customer, (ii) identifying the separate performance obligations in the contract, (iii) determining the transaction price, (iv) allocating the transaction price to the separate performance obligations, and (v) recognizing revenue when each performance obligation is satisfied. This guidance was deferred by ASU No. 2015-14, issued by the FASB in August 2015, and is effective for annual and interim reporting periods beginning after December 15, 2017, with early adoption permitted for annual and interim reporting periods beginning after December 15, 2016. The Company has the option to apply the provisions of ASU No. 2014-09 either retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of applying this ASU recognized at the date of initial application. The Company is currently evaluating the impact the adoption of this ASU will have on the Company’s consolidated financial statements.

In 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205-40). ASU No. 2014-15 requires management to perform interim and annual assessments on whether there are conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year of the date the financial statements are issued and to provide related disclosures, if required. ASU No. 2014-15 applies to all entities and is effective for annual periods ending after December 15, 2016, and interim periods within annual periods beginning after December 15, 2016. Early application is permitted for annual or interim reporting periods for which the financial statements have not previously been issued. The adoption of ASU No. 2014-15 is not expected to have a material effect on the Company’s consolidated financial statements.

In April 2015, the FASB issued ASU No. 2015-03, Interest – Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. ASU No. 2015-03 states that entities that have historically presented debt issuance costs as an asset, related to a recognized debt liability, will be required to present those costs as a direct deduction from the carrying amount of that debt liability. This presentation will result in debt issuance cost being presented the same way debt discounts have historically been handled. ASU No. 2015-03 does not change the recognition, measurement, or subsequent measurement guidance for debt issuance costs. This guidance is effective for annual reporting periods beginning after December 15, 2016, and interim periods within annual reporting periods beginning after December 15, 2016. Early adoption is permitted. The Company expects this new guidance will reduce total assets and total long-term debt on its consolidated balance sheets by amounts classified as deferred debt issuance costs, but does not expect this Update to have any other effect on its consolidated financial statements.

In April 2015, the FASB issued ASU No. 2015-05, Intangibles – Goodwill and Other – Internal Use Software (Subtopic 350-40). The pronouncement was issued to provide guidance concerning accounting for fees in a cloud computing arrangement. The pronouncement is effective for reporting periods beginning after December 15, 2015. The adoption of ASU 2015-05 is not expected to have a significant impact on the Company’s consolidated financial statements.

In November 2015, the FASB issued ASU No. 2015-17, Income Taxes – Balance Sheet Classification of Deferred Taxes (Subtopic 740). The pronouncement was issued to simplify the presentation of deferred income taxes by requiring that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. The current requirement that deferred tax liabilities and assets of a tax-paying component of an entity be offset and presented as a single amount is not affected by the amendments in this Update. The pronouncement is effective for reporting periods beginning after December 15, 2016. Early application is permitted as of the beginning of an interim or annual period. The Company expects this new guidance will reduce total assets and total liabilities on its consolidated balance sheets as amounts will now be presented net in a single line item. The adoption of ASU 2015-17 is not expected to have any additional impact on the Company’s consolidated financial statements.

XML

Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Millions	1 Months Ended	9 Months Ended
	Sep. 30, 2015	Oct. 31, 2015	Nov. 01, 2014
Commitment And Contingencies [Line Items]
SEC investigation expense		$ 0.2	$ 2.9
Securities and Exchange Commission [Member]
Commitment And Contingencies [Line Items]
Civil monetary penalty payable as part of settlement	$ 0.8

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Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Oct. 31, 2015	Nov. 01, 2014
Cash flows from operating activities:
Net income	$ 17,461	$ 14,601
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	22,050	21,709
Share-based compensation	5,773	5,492
Store closing charges	7	1,163
Impairment of property and other assets		96
Loss on disposal of property and equipment	53	121
Deferred income taxes	(809)	1,399
Tax benefit from equity issuances	3,836	756
Excess tax benefits from share-based compensation	(3,875)	(879)
Changes in assets and liabilities:
Inventories	(87,289)	(82,204)
Prepaid expenses and other current assets	(12,181)	(4,278)
Other assets	603	(3,591)
Accounts payable	71,617	83,446
Accrued expenses and other current liabilities	(2,177)	(1,729)
Other liabilities	11,226	6,477
Net cash provided by operating activities	26,295	42,579
Cash flows from investing activities:
Net acquisition of property and equipment	(34,470)	(34,043)
Net cash used in investing activities	(34,470)	(34,043)
Cash flows from financing activities:
Proceeds from borrowings	533,334
Repayments of debt	(341,501)
Debt issuance costs	(380)
Cash dividends paid	(235,691)	(8,929)
Excess tax benefits from share-based compensation	3,875	879
Proceeds from exercise of stock options and other	562	427
Repurchase of common stock	(3,212)	(2,885)
Net cash used in financing activities	(43,013)	(10,508)
Net decrease in cash and cash equivalents	(51,188)	(1,972)
Cash and cash equivalents at beginning of year	65,314	66,854
Cash and cash equivalents at end of period	14,126	64,882
Supplemental disclosures of cash flow information:
Income taxes paid	12,304	8,802
Interest paid	2,130	273
Purchases of property and equipment included in accounts payable, accrued expenses and other current liabilities at period end	$ 4,051	$ 1,356

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Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Oct. 31, 2015	Jan. 31, 2015	Nov. 01, 2014
Current assets:
Cash and cash equivalents	$ 14,126	$ 65,314	$ 64,882
Inventories	372,912	285,623	343,721
Prepaid expenses and other current assets	34,681	22,733	29,840
Total current assets	421,719	373,670	438,443
Property and equipment, net of accumulated depreciation and amortization of $185,520, $166,646 and $168,557, respectively	162,907	148,782	150,646
Other assets	30,323	30,639	31,005
Total assets	614,949	553,091	620,094
Current liabilities:
Accounts payable	202,176	129,924	214,635
Current portion of debt	10,000
Accrued expenses and other current liabilities	68,162	69,213	63,332
Total current liabilities	280,338	199,137	277,967
Long-term debt	181,833
Deferred rent	41,163	31,284	32,063
Other liabilities	39,355	37,732	36,211
Total liabilities	$ 542,689	$ 268,153	$ 346,241
COMMITMENTS AND CONTINGENCIES
Shareholders' equity:
Preferred stock - $.01 par value; 1,000,000 shares authorized; no shares issued or outstanding	$ 0	$ 0	$ 0
Common stock - $.01 par value; 100,000,000 shares authorized; 45,675,579, 44,918,649 and 44,945,280 shares issued and outstanding, respectively	457	449	449
Additional paid-in capital	41,826	34,875	32,532
Retained earnings	30,397	250,046	241,125
Accumulated other comprehensive loss	(420)	(432)	(253)
Total shareholders' equity	72,260	284,938	273,853
Total liabilities and shareholders' equity	$ 614,949	$ 553,091	$ 620,094

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Condensed Consolidated Statement of Shareholders' Equity (Unaudited) - 9 months ended Oct. 31, 2015 - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Accumulated Other Comprehensive Loss [Member]
Balance at Jan. 31, 2015	$ 284,938	$ 449	$ 34,875	$ 250,046	$ (432)
Balance, shares at Jan. 31, 2015		44,919
Net income	17,461			17,461
Other comprehensive income, net of tax	12				12
Common shares issued under stock option plan	204	$ 1	203
Common shares issued under stock option plan, shares		70
Common shares issued under employee stock purchase plan	358		358
Common shares issued under employee stock purchase plan, shares		40
Reacquired shares	(3,212)	$ (2)	(3,210)
Reacquired shares, shares		(214)
Issuance of restricted stock, net		$ 9	(9)
Issuance of restricted stock, net, shares		861
Share-based compensation	5,773		5,773
Tax benefit from equity issuances	3,836		3,836
Cash dividends paid	(235,691)			(235,691)
Cash dividends payable	(1,419)			(1,419)
Balance at Oct. 31, 2015	$ 72,260	$ 457	$ 41,826	$ 30,397	$ (420)
Balance, shares at Oct. 31, 2015		45,676

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Debt - Additional Information (Detail)		9 Months Ended
	Feb. 03, 2015 USD ($)	Oct. 31, 2015 USD ($)
Debt Instrument [Line Items]
Debt issuance costs		$ 400,000
Borrowing capacity covenant, percentage of credit card receivables and net recovery of inventories		100.00%
Letters of credit, outstanding		$ 6,400,000
Remaining borrowing capacity under line of credit facility		$ 75,100,000
Fixed charges coverage ratio		1
Equipment Term Loan [Member]
Debt Instrument [Line Items]
Credit facility maximum borrowing capacity	$ 25,000,000
Credit facility agreement expiration date	Feb. 28, 2018
Weighted average interest rate on debt amounts outstanding		2.19%
Credit Agreement [Member]
Debt Instrument [Line Items]
Debt instrument interest rate		0.50%
Terms of credit agreement		Base Rate Loans bear interest equal to the highest of (a) the Federal Funds Rate plus one-half of one percent (0.50%), (b) the Adjusted LIBO Rate plus one percent (1.00%), or (c) the Wells Fargo "prime rate," plus the Applicable Margin (25 to 75 basis points).
Weighted average interest rate on debt amounts outstanding		1.74%
Former Senior Secured Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Credit facility maximum borrowing capacity	$ 100,000,000
Credit facility agreement expiration date	Feb. 28, 2017
Wells Fargo Bank [Member] | Credit Agreement [Member]
Debt Instrument [Line Items]
Credit facility maximum borrowing capacity	$ 250,000,000
Credit facility agreement expiration date	Feb. 28, 2020
London Interbank Offered Rate (LIBOR) [Member] | Equipment Term Loan [Member]
Debt Instrument [Line Items]
Debt instrument interest rate		2.00%
London Interbank Offered Rate (LIBOR) [Member] | Credit Agreement [Member]
Debt Instrument [Line Items]
Debt instrument interest rate		1.00%

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Debt - Aggregate Maturities of Long-term Debt (Detail) $ in Thousands	Oct. 31, 2015 USD ($)
Debt Disclosure [Abstract]
2015	$ 2,500
2016	10,000
2017	10,833
2018	0
2019	0
Thereafter	168,500
Total	$ 191,833

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Condensed Consolidated Statement of Shareholders' Equity (Unaudited) (Parenthetical)	9 Months Ended
	Oct. 31, 2015 $ / shares
Cash dividends paid, per share	$ 5.225
Retained Earnings [Member]
Cash dividends paid, per share	$ 5.225

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Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands	Oct. 31, 2015	Jan. 31, 2015	Nov. 01, 2014
Statement of Financial Position [Abstract]
Accumulated depreciation and amortization	$ 185,520	$ 166,646	$ 168,557
Preferred stock, par value	$ 0.01	$ 0.01	$ 0.01
Preferred stock, shares authorized	1,000,000	1,000,000	1,000,000
Preferred stock, shares issued	0	0	0
Preferred stock, shares outstanding	0	0	0
Common stock, par value	$ 0.01	$ 0.01	$ 0.01
Common stock, shares authorized	100,000,000	100,000,000	100,000,000
Common stock, shares issued	45,675,579	44,918,649	44,945,280
Common stock, shares outstanding	45,675,579	44,918,649	44,945,280

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Accrued Expenses and Other Current Liabilities (Tables)

9 Months Ended

Oct. 31, 2015

Payables and Accruals [Abstract]

Major Components of Accrued Expenses and Other Current Liabilities

The major components of accrued expenses and other current liabilities are as follows:

	October 31,		January 31,		November 1,
	2015		2015		2014
Compensation and employee benefits	$	10,141	$	12,519	$	9,758
Unredeemed gift and merchandise return cards		7,708		10,614		6,786
Property taxes		14,179		12,805		13,176
Accrued vacation		7,241		7,241		6,976
Other		28,893		26,034		26,636
Accrued expenses and other current liabilities	$	68,162	$	69,213	$	63,332

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Document and Entity Information - shares	9 Months Ended
	Oct. 31, 2015	Nov. 27, 2015
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Oct. 31, 2015
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	Q3
Trading Symbol	SMRT
Entity Registrant Name	STEIN MART INC
Entity Central Index Key	0000884940
Current Fiscal Year End Date	--01-30
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		45,678,715

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Debt (Tables)

9 Months Ended

Oct. 31, 2015

Debt Disclosure [Abstract]

Summary of Long-term Debt

Long-term debt consisted of the following at October 31, 2015:

Revolving credit facility	$	168,500
Equipment term loan		23,333
Total debt		191,833
Current maturities		(10,000	)
Long-term debt	$	181,833

Aggregate Maturities of Long-term Debt

The aggregate maturities of long-term debt subsequent to October 31, 2015 for the following fiscal years:

2015	$	2,500
2016		10,000
2017		10,833
2018		—
2019		—
Thereafter		168,500
Total	$	191,833

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Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 31, 2015	Nov. 01, 2014	Oct. 31, 2015	Nov. 01, 2014
Income Statement [Abstract]
Net sales	$ 300,665	$ 303,667	$ 965,769	$ 930,678
Cost of merchandise sold	218,497	219,106	686,286	657,547
Gross profit	82,168	84,561	279,483	273,131
Selling, general and administrative expenses	81,464	86,277	248,631	248,957
Operating income (loss)	704	(1,716)	30,852	24,174
Interest expense, net	891	66	2,384	200
(Loss) income before income taxes	(187)	(1,782)	28,468	23,974
Income tax expense (benefit)	10	(571)	11,007	9,373
Net (loss) income	$ (197)	$ (1,211)	$ 17,461	$ 14,601
Net (loss) income per share:
Basic	$ (0.01)	$ (0.03)	$ 0.39	$ 0.33
Diluted	$ (0.01)	$ (0.03)	$ 0.37	$ 0.32
Weighted-average shares outstanding:
Basic	44,791	43,857	44,704	43,833
Diluted	44,791	43,857	45,916	44,664
Dividends declared per common share	$ 0.075	$ 0.075	$ 5.225	$ 0.200

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Debt

9 Months Ended

Oct. 31, 2015

Debt Disclosure [Abstract]

Debt

4. Debt

On February 3, 2015, we entered into a $250 million senior secured revolving credit facility pursuant to a second amended and restated credit agreement with Wells Fargo Bank (the “Credit Agreement”) that will mature in February 2020 and a secured $25 million master loan agreement with Wells Fargo Equipment Finance, Inc. (the “Equipment Term Loan” and, together with the Credit Agreement, the “Credit Facilities”) that will mature in February 2018. The Credit Facilities replace the Company’s former $100 million senior secured revolving credit facility which was set to mature on February 28, 2017. Borrowings under the Credit Facilities were initially used for a special dividend, but subsequently may be used for working capital, capital expenditures and other general corporate purposes. During 2015, debt issuance costs associated with the Credit Facilities were capitalized in the amount of $0.4 million and will be amortized over their respective terms.

Long-term debt consisted of the following at October 31, 2015:

Revolving credit facility	$	168,500
Equipment term loan		23,333
Total debt		191,833
Current maturities		(10,000	)
Long-term debt	$	181,833

The aggregate maturities of long-term debt subsequent to October 31, 2015 for the following fiscal years:

2015	$	2,500
2016		10,000
2017		10,833
2018		—
2019		—
Thereafter		168,500
Total	$	191,833

The total amount available under the Credit Agreement is the lesser of the Aggregate Commitment or 100% of eligible credit card receivables and the Net Recovery Percentage of inventories less reserves. At October 31, 2015, in addition to outstanding borrowings under the Credit Agreement, the Company had $6.4 million of outstanding letters of credit, which reduced the Company’s availability under the Credit Agreement to $75.1 million.

The Credit Facilities contain customary representations and warranties, affirmative and negative covenants (including, in the Credit Agreement, the requirement of a 1 to 1 consolidated fixed charge coverage ratio upon the occurrence and during the continuance of any Covenant Compliance Event, as defined in the Credit Agreement), and events of default for facilities of this type and are cross-collateralized and cross-defaulted. Collateral for the Credit Facilities consists of substantially all of our personal property. Wells Fargo Bank has a first lien on all collateral other than equipment and Wells Fargo Equipment Finance has a first lien on equipment. At October 31, 2015, the Company was in compliance with all debt covenants.

Borrowings under the Credit Agreement shall be either Base Rate Loans or LIBO Rate Loans. LIBO Rate Loans bear interest equal to the Adjusted LIBO Rate plus the Applicable Margin (125 to 175 basis points) depending on the Quarterly Average Excess Availability. Base Rate Loans bear interest equal to the highest of (a) the Federal Funds Rate plus one-half of one percent (0.50%), (b) the Adjusted LIBO Rate plus one percent (1.00%), or (c) the Wells Fargo “prime rate,” plus the Applicable Margin (25 to 75 basis points).

Borrowings under the Equipment Term Loan shall be LIBO Rate plus 2%.

The weighted average interest rate for amounts outstanding under the Credit Agreement and Equipment Term Loan were 1.74 percent and 2.19 percent, respectively, as of October 31, 2015.

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Fair Value Measurements

9 Months Ended

Oct. 31, 2015

Fair Value Disclosures [Abstract]

Fair Value Measurements

3. Fair Value Measurements

We have historically had money market fund investments classified as cash equivalents, which are Level 1 assets because fair value is based on readily available market prices. The fair value of these assets was $53.7 million at January 31, 2015 and $50.2 million at November 1, 2014. We did not have money market fund investments at October 31, 2015.

As the Company’s primary debt obligations are variable rate, there are no significant differences between the estimated fair value (Level 2 measurements) and the carrying value of the Company’s debt obligations at October 31, 2015. The Company did not have outstanding debt at January 31, 2015 and November 1, 2014.

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Debt - Summary of Long-term Debt (Detail) $ in Thousands	Oct. 31, 2015 USD ($)
Debt Disclosure [Abstract]
Revolving credit facility	$ 168,500
Equipment term loan	23,333
Total	191,833
Current maturities	(10,000)
Long-term debt	$ 181,833

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Earnings Per Share (Tables)

9 Months Ended

Oct. 31, 2015

Earnings Per Share [Abstract]

Basic and Diluted Income Per Common Share

The following table presents the calculation of basic and diluted EPS (shares in thousands):

	13 Weeks Ended			13 Weeks Ended			39 Weeks Ended		39 Weeks Ended
	October 31, 2015			November 1, 2014			October 31, 2015		November 1, 2014
Basic (Loss) Earnings Per Common Share:
Net (loss) income	$	(197	)	$	(1,211	)	$	17,461	$	14,601
Income allocated to participating securities		26			—			205		268
Net (loss) income available to common shareholders	$	(223	)	$	(1,211	)	$	17,256	$	14,333
Basic weighted-average shares outstanding		44,791			43,857			44,704		43,833
Basic (loss) earnings per share	$	(0.01	)	$	(0.03	)	$	0.39	$	0.33
Diluted (Loss) Earnings Per Common Share:
Net (loss) income	$	(197	)	$	(1,211	)	$	17,461	$	14,601
Income allocated to participating securities		26			—			255		266
Net (loss) income available to common shareholders	$	(223	)	$	(1,211	)	$	17,206	$	14,335
Basic weighted-average shares outstanding		44,791			43,857			44,704		43,833
Incremental shares from share-based compensation plans		—			—			1,212		831
Diluted weighted-average shares outstanding		44,791			43,857			45,916		44,664
Diluted (loss) earnings per share	$	(0.01	)	$	(0.03	)	$	0.37	$	0.32

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Commitments and Contingencies

9 Months Ended

Oct. 31, 2015

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

7. Commitments and Contingencies

On July 24, 2013, the Securities and Exchange Commission (the “SEC”) informed us that it was conducting an investigation of the Company and made a request for voluntary production of documents and information. The request was focused on our restatement of 2012 and prior consolidated financial statements and our 2013 change in auditors. In an administrative proceeding, the SEC found that the Company had violated the reporting, books and records, and internal controls provisions of the Securities Exchange Act of 1934 during the restatement period and ordered the Company to cease and desist from committing or causing any violations and any future violations of such SEC rules. In September 2015, the Company agreed to a settlement with the SEC without admitting or denying the findings of the SEC and also agreed to pay a civil monetary penalty of $0.8 million. The Company previously established a reserve for the potential settlement of this matter, which did not require significant adjustment in the third quarter of 2015. The Company recognized $0.2 million and $2.9 million of expenses, net of expected insurance recoveries, related to the SEC investigation during the 39 weeks ended October 31, 2015 and November 1, 2014, respectively.

The SEC did not allege fraud by the Company and did not bring charges against any individual. In connection with the settlement, the SEC considered remedial acts undertaken by the Company, including its enhancement of internal controls, retention of additional accounting personnel, and the Company’s cooperation with the SEC staff during the course of the investigation.

We are involved in various routine legal proceedings incidental to the conduct of our business. Management, based upon the advice of outside legal counsel, does not believe that any of these legal proceedings will have a material adverse effect on our financial condition, results of operations or cash flows.

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Shareholders' Equity

9 Months Ended

Oct. 31, 2015

Equity [Abstract]

Shareholders' Equity

5. Shareholders’ Equity

Dividends

During 2015, we paid a special cash dividend of $5.00 per common share on February 27, 2015 and three quarterly dividends of $0.075 per common share on April 17, 2015, July 17, 2015 and October 16, 2015. In 2014, we paid quarterly dividends of $0.05 per common share on April 18, 2014 and $0.075 per common share on July 18, 2014 and October 17, 2014.

On December 9, 2015, the Board of Directors declared a dividend of $0.075 per common share to be paid on January 15, 2016 to shareholders of record on December 31, 2015.

Stock Repurchase Plan

During the 39 weeks ended October 31, 2015, we repurchased 213,815 shares of our common stock at a total cost of $3.2 million. During the 39 weeks ended November 1, 2014, we repurchased 228,553 shares of our common stock at a total cost of $2.9 million. Stock repurchases were for tax withholding amounts due on the vesting of employee stock awards and during the first nine months of 2015 did not include any shares purchased on the open market under our previously authorized stock repurchase plan. As of October 31, 2015, there are 269,295 shares that can be repurchased pursuant to the Board of Director’s current authorization. In November 2015, the Board of Directors authorized the repurchase of 500,000 shares of our common stock in addition to amounts previously authorized.

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Earnings Per Share

9 Months Ended

Oct. 31, 2015

Earnings Per Share [Abstract]

Earnings Per Share

6. Earnings Per Share

We calculate earnings per common share (“EPS”) using the two-class method. Unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are participating securities and are included in the computation of EPS. Our restricted stock awards in 2013 and prior are considered “participating securities” because they contain non-forfeitable rights to dividends.

The following table presents the calculation of basic and diluted EPS (shares in thousands):

	13 Weeks Ended			13 Weeks Ended			39 Weeks Ended		39 Weeks Ended
	October 31, 2015			November 1, 2014			October 31, 2015		November 1, 2014
Basic (Loss) Earnings Per Common Share:
Net (loss) income	$	(197	)	$	(1,211	)	$	17,461	$	14,601
Income allocated to participating securities		26			—			205		268
Net (loss) income available to common shareholders	$	(223	)	$	(1,211	)	$	17,256	$	14,333
Basic weighted-average shares outstanding		44,791			43,857			44,704		43,833
Basic (loss) earnings per share	$	(0.01	)	$	(0.03	)	$	0.39	$	0.33
Diluted (Loss) Earnings Per Common Share:
Net (loss) income	$	(197	)	$	(1,211	)	$	17,461	$	14,601
Income allocated to participating securities		26			—			255		266
Net (loss) income available to common shareholders	$	(223	)	$	(1,211	)	$	17,206	$	14,335
Basic weighted-average shares outstanding		44,791			43,857			44,704		43,833
Incremental shares from share-based compensation plans		—			—			1,212		831
Diluted weighted-average shares outstanding		44,791			43,857			45,916		44,664
Diluted (loss) earnings per share	$	(0.01	)	$	(0.03	)	$	0.37	$	0.32

Due to the Company’s net loss position for the third quarter of 2015 and 2014, 0.4 million and 0.8 million weighted average unvested restricted shares (participating securities) and 1.3 million and 1.0 million weighted average common stock equivalents (non-participating securities), respectively, were not considered in the calculation of net loss available to common shareholders used for both basic and diluted EPS for the quarter.

In addition, options to acquire shares totaling approximately 0.4 million shares of common stock that were outstanding during each of the third quarters of 2015 and 2014 were not included in the computation of diluted earnings per common share. Options excluded were those that had exercise prices greater than the average market price of the common shares such that inclusion would have been anti-dilutive. For the first nine months of 2015 and 2014, options to acquire shares of approximately 0.2 million and 0.3 million shares of common stock, respectively, were not included in the computation of diluted earnings per share for the aforementioned reasons.

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Basis of Presentation (Policies)

9 Months Ended

Oct. 31, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

Basis of Presentation

The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting primarily of normal and recurring adjustments) considered necessary for fair presentation of the Condensed Consolidated Financial Statements have been included. Due to the seasonality of our business, results for any quarter are not necessarily indicative of the results that may be achieved for a full fiscal year. For further information, refer to the Consolidated Financial Statements and footnotes thereto included in our annual report on Form 10-K for the year ended January 31, 2015.

As used herein, the terms “we,” “our,” “us,” “Stein Mart” and the “Company” refer to Stein Mart, Inc. and its wholly-owned subsidiaries.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606). ASU No. 2014-09 provides a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. ASU No. 2014-09 will require an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This update creates a five-step model that requires entities to exercise judgment when considering the terms of the contract(s) which include (i) identifying the contract(s) with the customer, (ii) identifying the separate performance obligations in the contract, (iii) determining the transaction price, (iv) allocating the transaction price to the separate performance obligations, and (v) recognizing revenue when each performance obligation is satisfied. This guidance was deferred by ASU No. 2015-14, issued by the FASB in August 2015, and is effective for annual and interim reporting periods beginning after December 15, 2017, with early adoption permitted for annual and interim reporting periods beginning after December 15, 2016. The Company has the option to apply the provisions of ASU No. 2014-09 either retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of applying this ASU recognized at the date of initial application. The Company is currently evaluating the impact the adoption of this ASU will have on the Company’s consolidated financial statements.

In 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205-40). ASU No. 2014-15 requires management to perform interim and annual assessments on whether there are conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year of the date the financial statements are issued and to provide related disclosures, if required. ASU No. 2014-15 applies to all entities and is effective for annual periods ending after December 15, 2016, and interim periods within annual periods beginning after December 15, 2016. Early application is permitted for annual or interim reporting periods for which the financial statements have not previously been issued. The adoption of ASU No. 2014-15 is not expected to have a material effect on the Company’s consolidated financial statements.

In April 2015, the FASB issued ASU No. 2015-03, Interest – Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. ASU No. 2015-03 states that entities that have historically presented debt issuance costs as an asset, related to a recognized debt liability, will be required to present those costs as a direct deduction from the carrying amount of that debt liability. This presentation will result in debt issuance cost being presented the same way debt discounts have historically been handled. ASU No. 2015-03 does not change the recognition, measurement, or subsequent measurement guidance for debt issuance costs. This guidance is effective for annual reporting periods beginning after December 15, 2016, and interim periods within annual reporting periods beginning after December 15, 2016. Early adoption is permitted. The Company expects this new guidance will reduce total assets and total long-term debt on its consolidated balance sheets by amounts classified as deferred debt issuance costs, but does not expect this Update to have any other effect on its consolidated financial statements.

In April 2015, the FASB issued ASU No. 2015-05, Intangibles – Goodwill and Other – Internal Use Software (Subtopic 350-40). The pronouncement was issued to provide guidance concerning accounting for fees in a cloud computing arrangement. The pronouncement is effective for reporting periods beginning after December 15, 2015. The adoption of ASU 2015-05 is not expected to have a significant impact on the Company’s consolidated financial statements.

In November 2015, the FASB issued ASU No. 2015-17, Income Taxes – Balance Sheet Classification of Deferred Taxes (Subtopic 740). The pronouncement was issued to simplify the presentation of deferred income taxes by requiring that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. The current requirement that deferred tax liabilities and assets of a tax-paying component of an entity be offset and presented as a single amount is not affected by the amendments in this Update. The pronouncement is effective for reporting periods beginning after December 15, 2016. Early application is permitted as of the beginning of an interim or annual period. The Company expects this new guidance will reduce total assets and total liabilities on its consolidated balance sheets as amounts will now be presented net in a single line item. The adoption of ASU 2015-17 is not expected to have any additional impact on the Company’s consolidated financial statements.

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Fair Value Measurements - Additional Information (Detail) - USD ($) $ in Millions	Jan. 31, 2015	Nov. 01, 2014
Money Market Funds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of cash and cash equivalents	$ 53.7	$ 50.2

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Earnings Per Share - Basic and Diluted Income Per Common Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 31, 2015	Nov. 01, 2014	Oct. 31, 2015	Nov. 01, 2014
Basic (Loss) Earnings Per Common Share:
Net (loss) income	$ (197)	$ (1,211)	$ 17,461	$ 14,601
Income allocated to participating securities	26		205	268
Net (loss) income available to common shareholders	$ (223)	$ (1,211)	$ 17,256	$ 14,333
Basic weighted-average shares outstanding	44,791	43,857	44,704	43,833
Basic (loss) earnings per share	$ (0.01)	$ (0.03)	$ 0.39	$ 0.33
Diluted (Loss) Earnings Per Common Share:
Net (loss) income	$ (197)	$ (1,211)	$ 17,461	$ 14,601
Income allocated to participating securities	26		255	266
Net (loss) income available to common shareholders	$ (223)	$ (1,211)	$ 17,206	$ 14,335
Basic weighted-average shares outstanding	44,791	43,857	44,704	43,833
Incremental shares from share-based compensation plans			1,212	831
Diluted weighted-average shares outstanding	44,791	43,857	45,916	44,664
Diluted (loss) earnings per share	$ (0.01)	$ (0.03)	$ 0.37	$ 0.32

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Condensed Consolidated Statements of Comprehensive (Loss) Income (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 31, 2015	Nov. 01, 2014	Oct. 31, 2015	Nov. 01, 2014
Statement of Comprehensive Income [Abstract]
Net (loss) income	$ (197)	$ (1,211)	$ 17,461	$ 14,601
Other comprehensive income, net of tax:
Amounts reclassified from accumulated other comprehensive income	4	3	12	8
Comprehensive (loss) income	$ (193)	$ (1,208)	$ 17,473	$ 14,609

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Accrued Expenses and Other Current Liabilities

9 Months Ended

Oct. 31, 2015

Payables and Accruals [Abstract]

Accrued Expenses and Other Current Liabilities

2. Accrued Expenses and Other Current Liabilities

The major components of accrued expenses and other current liabilities are as follows:

	October 31,		January 31,		November 1,
	2015		2015		2014
Compensation and employee benefits	$	10,141	$	12,519	$	9,758
Unredeemed gift and merchandise return cards		7,708		10,614		6,786
Property taxes		14,179		12,805		13,176
Accrued vacation		7,241		7,241		6,976
Other		28,893		26,034		26,636
Accrued expenses and other current liabilities	$	68,162	$	69,213	$	63,332

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Earnings Per Share - Additional Information (Detail) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Oct. 31, 2015	Nov. 01, 2014	Oct. 31, 2015	Nov. 01, 2014
Earnings Per Share [Line Items]
Weighted average common stock equivalents	44,791	43,857	45,916	44,664
Weighted average common stock equivalents	400	400	200	300
Participating Securities [Member]
Earnings Per Share [Line Items]
Weighted average unvested restricted shares	400	800
Non Participating Securities [Member]
Earnings Per Share [Line Items]
Weighted average common stock equivalents	1,300	1,000

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Accrued Expenses and Other Current Liabilities - Major Components of Accrued Expenses and Other Current Liabilities (Detail) - USD ($) $ in Thousands	Oct. 31, 2015	Jan. 31, 2015	Nov. 01, 2014
Accrued Liabilities and Other Liabilities [Abstract]
Compensation and employee benefits	$ 10,141	$ 12,519	$ 9,758
Unredeemed gift and merchandise return cards	7,708	10,614	6,786
Property taxes	14,179	12,805	13,176
Accrued vacation	7,241	7,241	6,976
Other	28,893	26,034	26,636
Accrued expenses and other current liabilities	$ 68,162	$ 69,213	$ 63,332