Signet UK sales drop 1.7% to GBP95.7m in Q2

SIGNET_ernestjonesshop_1.jpg

Signet Jewelers Limited, owner and operator of Ernest Jones, Leslie Davis and H Samuel stores in the UK, has today announced its Q2 sales and earnings growth for the 13 weeks to July 28.

The company has reported that its same-store sales are up 7.1%, its operating income is up 8.4%to $110.9 million (£69.9m).

Mike Barnes, Signet’s chief executive, said: “We delivered strong second quarter results driven by a 12.5% increase in same store sales at Kay [in the US] and positive same store sales in the UK.

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“This combined with expansion in operating margin drove a double digit increase in earnings per share. As we begin the second half of the year, we remain focused on delivering an exceptional customer experience with exciting merchandise programs, new enhanced marketing programs, and further development of our digital sales capabilities; as always, driven by our talented team. We believe these strengths leave us well positioned to deliver
our objectives for the year.”

Signet’s Q2 sales were up 7.1% compared with 9.9% in the 13 weeks ended July 30 2011.

Its total sales were $853.9 million (£537.8m) compared with $797.6 million in Q2 last year, up $56.3 million or 7.1%.

Signet’s e-commerce sales were $24.2 million (£15.3m) compared to $17.3 million in the second quarter of 2011, up 39.9%.

In the UK division total sales dropped to $152.0 million (£95.7m) compared to $154.6 million (£97.4m) in Q2 2011, down $2.6 million or 1.7%.

Same store sales increased 2.1% said to be driven by branded jewellery and watches.

In the UK Ernest Jones, incorporating Leslie Davis, exhibited the largest increase in same-store sales, up 4.4%, while H Samuel sales crept up just 0.1% in Q2.

H Samuel’s sales totalled $78.7 million (£49.6m), while Ernest Jones were $73.3 million (£46.2m).

In the second quarter Signets gross margin was $311.2 million (£196.1m) or 36.4% of sales as compared to $294.8 million (£185.7m).

Gross margin dollars in the UK decreased by $4.9 million (£3.1m) compared to Q2 2011, said to be a result of a decrease in gross merchandise margin of 210 basis points caused by customers’ preference for promotional merchandise and merchandise mix, which were partially offset by lower store occupancy expenses.

In the UK division, operating loss was $0.3 million or (0.2)% of sales as compared to operating income of $2.8 million or 1.8% of sales in the second quarter of Fiscal 2012.

Net income for Signet as a whole was $70.7 million (£44.5m).

Looking ahead, Signet said it expects same-store sales in the third quarter to be in the low to mid single digit range.

Signet is currently operating 1,845 stores globally with 328 H Samuel stores and 194 Ernest Jones stores. It has closed eight H Samuel stores this year and six Ernest Jones branches.

The third quarter results for the 13 weeks ending October 28 2012 are expected to be announced on Tuesday November 20.

 

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