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Signet Jewelers market value rockets to $4.4 billion as transformation boosts profits

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Signet Jewelers’ share price has risen five-fold over the past year from a low of $17 to a high of $85 in the past week, increasing the value of the group to $4.4 billion.

The Inspiring Brilliance transformation plan masterminded by CEO Virginia Drosos has seen sales and profits soar in the past two years, although the gains have been greatest in the group’s main market of the United States.

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In the most recent financial statement for Q2 2022 (ended July 31), revenue in the United States and UK totaled $1.8 billion, almost double the same store sales figure for the same quarter last year, and virtually flat on the same three months in 2019.

What investors appear to like is the dramatic improvement in profitability after trimming the network of stores, a well-managed shift to ecommerce, improving customer service and operational cost savings.

Operating income improved from a $22 million loss in 2019 to a $225 million profit in the most recent quarter.

In North America, average transaction values increased by 10% and the number of transactions rose by 70% compared to the same quarter last year.

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In the UK, ATV dropped by 4.5% while transaction volume rose by just 5%.

Despite stores being open in the comparable quarters in North America, ecommerce sales rose by 26% while in the UK, where stores were closed for much more of the quarter in 2020, brick and mortar sales rose by 136% year on year while ecommerce increased by 10%.

“Our performance this quarter demonstrates that our banner value propositions, product newness, always-on marketing and connected commerce experiences are resonating with new and loyal customers,” says Ms Drosos.

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