Financials

Signet Raises Guidance Again, Expands Selection of Lab-Grown Diamonds

FinancialsDec 02, 2021

Signet Raises Guidance Again, Expands Selection of Lab-Grown Diamonds

Its additions include an exclusive lab-grown diamond cut for Zales’ “Vera Wang True” line and a lab-grown option for Kay’s “Leo” cut.

An 18-karat white gold 1 3/8-carat emerald-cut diamond engagement ring from the Monique Lhuillier Bliss collection at Signet Jewelers’ banner Kay Jewelers. The collection has performed well since its launch, according to the company’s recent quarterly results.
Akron, Ohio—Signet Jewelers Ltd.’s third-quarter sales climbed double digits, encouraging the jeweler to up its guidance for the fiscal year once again.

In the third quarter ending Oct. 31, total sales were up 18 percent to $1.54 billion with same-store sales climbing 19 percent.

Compared to the third quarter of fiscal 2020, pre-pandemic, total sales were up 29 percent with same-store sales rising 37 percent. 

Year-to-date, Signet’s sales have totaled $5.01 billion, up 65 percent year-over-year.

Quarterly brick-and-mortar same-store sales rose 20 percent year-over-year in the third quarter and were up 29 percent compared with pre-pandemic levels. 

Online sales increased 14 percent year-over-year to $273.1 million. When compared with pre-pandemic levels, online sales have nearly doubled, jumping 96 percent.

“While uncertainties remain in the macro environment, our strategies are working, as evidenced by strong conversion rates and higher average transaction value,” Signet Jewelers CEO Gina Drosos said in a press release on the Q3 results.

“We have built a healthy operating structure enabling transformative investments that are attracting new customers and driving loyalty. Our data-driven customer insights and planning helped us secure earlier receipt of our holiday assortment and ensure no significant disruptions to our supply chain or labor needs.”

Signet Jewelers is cutting costs, expecting to see a four-year cumulative saving of $400 million through the end of fiscal 2022, but it’s also investing in technology to bolster its efficiency.

During an earnings call Thursday morning, Drosos described its data-driven labor model that plans out staffing needs, noting productivity is up 75 percent.

The company is also using a digital simulation of its supply chain to cut back on shipping delays and other logistical issues.

Signet is upping its distribution capacity by 25 percent, said Drosos, including adding local distribution points via its ship-from-store option.

After introducing a buy online, pick-up in store service last year, the jeweler has since expanded the program to 2,100 locations, Drosos said.

The investments have extended to its employees via a raise in wages, expanded benefits, training and development opportunities, and career growth, she said. 

In North America, where Signet’s banners include Kay, Jared and Zales, same-store sales rose 20 percent year-over-year, and were up 39 percent compared with pre-COVID levels.

Brick-and-mortar same-store sales climbed 22 percent compared with last year and were up 31 percent compared with pre-pandemic levels. 

Online sales in the region rose 15 percent compared with last year and nearly doubled, up 98 percent, when compared with before COVID.

The average transaction value increased 15 percent year-over-year, with the number of transactions up 4 percent.

In the U.K., same-store sales were up 9 percent compared with last year and up 18 percent compared with pre-pandemic levels.

Brick-and-mortar U.K. sales rose 9 percent year-over-year, and were up 18 percent when compared with before COVID. E-commerce sales increased 9 percent year-over-year and were up 72 percent compared with pre-pandemic levels.

Average transaction value dipped 4 percent while the number of transactions rose 13 percent year-over-year.

“Our merchandising teams have used our data to build and tier our [lab-grown diamond] assortment in a way that doesn’t compete with natural stones.” — Signet CEO Gina Drosos

Looking at sales by category, Signet’s bridal sales climbed 14 percent year-over-year in the quarter and are up 58 percent in the first nine months of the year.

Fashion jewelry sales were up 30 percent in the quarter and 85 percent in the nine-month period. Watch sales rose 38 percent in the quarter and 65 percent in the nine-month period.

Sales in the “others” category, which includes repairs, gifts, and other non-jewelry items, dipped 1 percent year-over-year, but were up 40 percent in the nine-month period.

Signet has expanded its assortment of lab-grown diamonds, Drosos said on the call.

“Our merchandising teams have used our data to build and tier our [lab-grown diamond] assortment in a way that doesn’t compete with natural stones,” she said.

For select styles, customers can choose a lab-grown stone with higher carat weight or clarity.

In addition, there will be an exclusive lab-grown diamond cut introduced into Zales’ “Vera Wang True” line and a lab-grown diamond option for Kay’s “Leo” cut through its “Leo Legacy” line.

 Related stories will be right here … 

Breaking down Signet’s Q3 performance by banner, Kay Jewelers posted quarterly sales of $573.4 million, up 17 percent year-over-year and up 67 percent in the first nine months of the year.

Zales posted quarterly sales of $291.9 million, up 16 percent year-over-year and up 66 percent in the nine-month period.

“Kay and Zales are appealing to increasingly differentiated consumer segments,” said Drosos.

While both banners attract bridal customers, almost 30 percent of new Zales customers are looking to buy jewelry for themselves, up 4 percent compared with two years ago.

At Kay, 65 percent of new customers are making a milestone purchase or buying a gift, 7 percent higher than two years ago.

“We plan our assortments with these journeys as our compass. We’re able to introduce newness with much better success rates because our customers are more precisely defined and because our assortments are relevant to the journey our customers are on,” said Drosos.

The new Monique Lhuillier x Kay Jewelers collection, launched at the end of September, has generated $2 million in sales.

At Jared, quarterly sales were up 19 percent to $277.1 million and up 60 percent in the nine-month period.

A new loyalty program, Vault Rewards, is being tested out at select Jared stores and is expected to roll out to all Signet banners, said Drosos.

The program gives customers exclusive discounts, a trial membership to newly acquired jewelry rental subscription service Rocksbox, and unlimited jewelry cleaning while Signet learns more about its customers.

Piercing Pagoda saw sales increase 19 percent in the quarter and nearly double in the nine-month period, up 95 percent.

The kiosk-centric brand recently underwent a name change, now called Banter by Piercing Pagoda.

E-tailer James Allen posted quarterly sales of $90.4 million, up 18 percent year-over-year and up 63 percent in the nine-month period.

Signet recently acquired Diamonds Direct but said it will include its results within the company’s North America segment rather than reporting it as a separate banner.

As for the possibility of new acquisitions, Chief Financial Officer Joan Hilson said the company’s main priority is growth investments.

“We always stay open-minded to what might be another way to bring new capabilities, especially new opportunities to learn,” she said on the call.

Looking at its store count, Hilson said the company expects to close 75 stores across its banners in fiscal 2022 and open 85 stores.

Most of the openings will be Banter by Piercing Pagoda locations, due to its strong-than-expected performance in select locations and favorable leases.

For the fiscal year ahead, Signet upped its financial guidance again, noting that the company’s sales momentum continued through Black Friday and Cyber Monday.

Signet is expecting revenue to reach $7.41-$7.49 billion, compared with its prior guidance of $7.04- $7.19 billion. 

Same-store sales are expected to grow 41 to 43 percent, up from its prior guidance of 35 to 38 percent.

Looking to the fourth quarter, revenue is expected to reach $2.40-$2.48 billion with same-store sales growth in the range of 6 to 9 percent.

Signet’s updated guidance depends on a variety of factors, including the “magnitude and duration of COVID-19,” particularly the Omicron variant, and the degree of the shift of consumer discretionary spending away from jewelry to more experience-based purchases, it said.

Lenore Fedowis the associate editor, news at National Jeweler, covering the retail beat and the business side of jewelry.

The Latest

Policies & IssuesJul 01, 2022
U.S. Expands Sanctions to Russian Gold

The U.K, Canada, and Japan have also banned the import of gold originating from Russia.

Recorded WebinarsJul 01, 2022
Watch: What to Know About Livestream Shopping

Jewelry marketing expert Laryssa Wirstiuk shares her tips and tricks for hosting a livestream shopping session.

SourcingJul 01, 2022
De Beers, Botswana Extend Sales Agreement for Third Time

The current agreement, originally set to expire in 2020, will now go through June 2023.

Brought to you by
Preparing for Proposal Season with High-Quality, A.I.-Graded Natural Diamonds

Rare & Forever is helping to create an enjoyable diamond buying experience for the millions of newly-engaged couples.

CollectionsJul 01, 2022
Piece of the Week: Brent Neale x Edie Parker Pendant

The brands have collaborated on a fine jewelry ode to cannabis.

Weekly QuizJun 30, 2022
This Week’s Quiz
Test your knowledge of the latest jewelry news with this quick test.
Take the Quiz
Supplier BulletinJun 30, 2022
Here’s Where You’ll Find The Best Online Jewelry Auctions

Sponsored by HiBid

CrimeJun 30, 2022
What JSA’s Annual Report Tells Us About Jewelry Crime in 2021

Plus, JSA President John Kennedy talks about the trajectory of industry crime over the last 20 years.

Brought to you by
Discover The Extraordinary Italian Jewelry In Las Vegas!

Experience all the Italian Jewelry market has to offer in Las Vegas.

CrimeJun 30, 2022
Smash-and-Grab Robbers Hit Booth at TEFAF: Watch the Video

The fair was evacuated temporarily Tuesday after four suspects smashed a showcase and stole jewelry from British jeweler Symbolic & Chase.

Events & AwardsJun 30, 2022
Nominations Are Open for Gem Awards 2023

The 21st annual awards show and gala will take place in New York City next March.

Events & AwardsJun 30, 2022
Registration Open for JIS Fall in Miami

The jewelry trade show is scheduled for Sept. 30-Oct. 3 at the Miami Beach Convention Center.

AuctionsJun 29, 2022
Bonhams Expands Again with Purchase of Paris Auction House

It is the fifth acquisition under the ownership of private equity firm Epiris, which bought Bonhams in 2018.

MajorsJun 29, 2022
Zales Has a New Diamond Cut

The “Celebration Infinite” diamond has more than three times the number of facets in a traditional brilliant-cut diamond, the retailer said.

WatchesJun 29, 2022
Bulova Introduces New Frank Sinatra Watches

The brand again partnered with the Frank Sinatra School of the Arts High School to celebrate the launch of the “Summer Wind” watches.

SurveysJun 29, 2022
U.S. Platinum Jewelry Demand Starts 2022 on a Strong Note

Retail ounce sales were up 23 percent year-over-year in Q1, according to the recent Platinum Jewellery Business Review.

Events & AwardsJun 29, 2022
Registration Is Now Open for the HardRock Summit 2022

Scheduled for Sept. 8-11, the event will comprise more than 310,000 square feet of show floor, exhibits, and education space.

ColumnistsJun 28, 2022
The PR Adviser: Why Should Someone Buy From You?

If you’re having trouble answering this question, columnist Lilian Raji can help you get a started with a few fill-in-the-blank statements.

IndependentsJun 28, 2022
This Jeweler Is Celebrating 40 Years With 40 Days of Giveaways

Continental Diamond in Minneapolis is awarding a total of $25,000 in prizes via daily sweepstakes.

CollectionsJun 28, 2022
Melissa Kaye’s New Collection Doubles the Color

“Lenox” marks the designer’s foray into bespoke jewels and large colored gemstones.

Events & AwardsJun 28, 2022
Second AGS Virtual Education Conference Is All About Negotiation Skills

“Confluence” is happening in August.

MajorsJun 27, 2022
George Holmes, Longtime Head Editor of JCK Magazine, Dies at 93

He first took a job at then Philadelphia-based Jewelers’ Circular-Keystone in 1963 and retired in 1996.

MajorsJun 27, 2022
Mayors, Analog:Shift Team Up With Goop

The lifestyle platform will stock fine jewelry and watches from the retailers on its website and in store.

CrimeJun 27, 2022
JSA Warns of ‘Pandemic’ of Distraction Thefts Nationwide

It cited two recent cases in California, plus incidents in Florida, Kansas, and Illinois.

IndependentsJun 27, 2022
Lewis Jewelers Set to Open New Ann Arbor Store This Summer

The 10,000-square-foot location allows for expanded collections from design partners while continuing custom design and other services.

CollectionsJun 27, 2022
This Designer Has Found a New Way to Bring Gemstones to Life

Svetlana Lazar’s “Wishing Well” collection utilizes an innovative component to mimic the movement of water beneath them.

Supplier BulletinJun 24, 2022
AGTA GemFair™ Denver is the Place to Be in September!

Sponsored by AGTA

Recorded WebinarsJun 24, 2022
Vegas Jewelry Recap: The Editors Weigh In

Watch the webinar in which National Jeweler’s editors talk about jewelry market week trends and their predictions for the rest of 2022.

×

This site uses cookies to give you the best online experience. By continuing to use & browse this site, we assume you agree to our Privacy Policy