Signet fails to shine as sales slump bites
The World’s biggest speciality jewellery retailer, Signet, has announced a 7.8 per cent fall in first half pre-tax profit, slightly better than analysts had feared.
Signet warned that the consumer environment in both the US and the UK remained “very challenging”.
Investec had forecast profits of $75.3m (£42.3m), five per cent lower than those reported.
Chief executive Terry Burman, which trades as H.Samuel and Ernest Jones in Britain, said: “The group’s strong balance sheet and superior operating metrics on both sides of the Atlantic enables the business to continue to implement its proven strategy. Appropriate adjustments in execution are being made to reflect the challenging economic conditions with tight control of costs, inventory, gross merchandise margin and investment in new space.
Signet currently operates just under 2,000 stores worldwide, with 559 stores based in the UK.
Operating profit came in at $4.5m, compared with a $0.6m loss last year. Gross margins rose by 70 basis points, with average unit selling prices up 13 per cent at H Samuel and 16 per cent at Ernest Jones. These reflected changing mix and increased prices.
In the UK Signet reported a 2.3 per cent jump in like-for-like sales, aided by watch sales.
“As always, the results for the year will be significantly influenced by the group’s performance during the important Christmas period,” added Burman.
