Financials

Signet Exceeds Expectations With a Strong Q3

FinancialsDec 05, 2019

Signet Exceeds Expectations With a Strong Q3

Same-store sales rose at all U.S. mall-based banners while online sales posted double-digit growth.

2018_Piercing-Pagoda.jpg
Signet Jewelers-owned Piercing Pagoda posted its sixth consecutive quarter of double-digit growth in Q3, with same-store sales rising 12 percent.

Akron, Ohio—Signet Jewelers Ltd. exceeded expectations in the third quarter, as comps rose at all U.S. mall-based banners and online sales posted double-digit growth.

In the third quarter ended Nov. 2, Signet’s same-store sales rose 2.1 percent year-over-year.

E-commerce sales were up 11 percent to $139.9 million, and accounted for 12 percent of total sales, up from 11 percent a year ago.

Brick-and-mortar same-store sales grew 1 percent.

Total sales reached $1.19 billion, essentially flat year-over-year on a both a reported and constant-currency basis.

Signet also reported a smaller-than-expected loss in the quarter, $43.7 million, causing its shares to rise 8 percent in pre-market trading.

It was the retailer’s North American chains—particularly Piercing Pagoda—and online sales that drove the increase while U.K. stores struggled due to Brexit, with comps dropping 5 percent, executives said on Thursday morning’s earnings call.

North America same-store sales were up 3 percent in the quarter. Average transaction value inched up 1 percent while the number of transactions increased 3 percent.

Kay and Jared stores held a lot of clearance sales in the third quarter, which ultimately impacted gross margin, though Chief Financial Officer Joan Hilson noted on the call, “Underneath that, we are pleased by the performance of new product.”

Signet’s total GAAP gross margin was $367.7 million, or 31 percent of sales, down 20 basis points year-over-year.

The retailer’s top performer in the third quarter was James Allen, which posted a 16 percent sales increase, followed by Piercing Pagoda at 12 percent.

CEO Gina Drosos said Q3 marked Piercing Pagoda’s sixth consecutive quarter of double-digit growth.

In addition, the ear piercing chain opened 11 new kiosks in “top-performing malls” in the period and launched its first advertising campaign.

Kay Jewelers saw same-store sales increase 4 percent, with the “Center of Me” collection, a line of Hallmark-branded jewelry, and Adrianna Papell bridal among the top sellers.

Comps at Zales were up 3 percent, due in part to the new Marilyn Monroe collection as well as the Disney-licensed “Frozen 2” and “Maleficent” lines.

Jared the Galleria of Jewelry (down 3 percent), Canadian chain Peoples (down 4 percent) and regional banners (down 16 percent) all posted same-store sales declines.

On Thursday’s call, Drosos said Signet has improved the effectiveness of its advertising spend, particularly by using data analytics to target customers online, and adopted a “mobile-first” approach to online advertising.

RELATED CONTENT: Mobile Shopping Emerges as an Early Holiday Winner

She

said the company launched its holiday marketing in the third quarter in order to begin driving awareness earlier.

Drosos also mentioned Signet’s efforts to improve the in-store experience and focus on services, which she called “an important part of our long-term strategy.”

Following a limited test run, Signet is now doing ear piercing in more than 400 Kay Jewelers stores.

It’s also ramping up its repair business across all banners.

Drosos said this coming weekend, the retailer is holding “Get Your Sparkle On” events in Kay, Jared and Zales stores. Customers are given a free jewelry cleaning and 10 percent off repair services.

Despite a relatively strong Q3, Signet still expects to post a same-store sales decline for the fiscal year of 1 to 2 percent, with total sales of $6.01 billion to $6.05 billion.

“Our financial guidance embeds the progress we have seen year to date balanced with our expectation for a competitive retail holiday environment,” as well as a shorter holiday season and continued impact from Brexit in the U.K., Drosos said.

As announced earlier this year, Signet will close 150 stores this fiscal year and open 35. Counted among the openings are some mall stores that are being moved to off-mall locations.

Net selling square footage will decline about 3 percent as a result of the closures.

The retailer said Thursday that it has closed 86 stores in the fiscal year to date.

Since FY 2018, Signet has reduced the size of its store base by 12 percent. Its store count as of Nov. 2 stands at 3,274: 2,813 locations in North America and 461 in the U.K.

The retailer is exiting failing malls and “simplifying its portfolio” by eliminating most of its regional banners, stores like JB Robinson Jewelers, Belden Jewelers and Gordon’s Jewelers.
Michelle Graffis the editor-in-chief at National Jeweler, directing the publication’s coverage both online and in print.

The Latest

Exterior of the Colorado Convention Center
Events & AwardsJun 05, 2023
HardRock Summit Organizers Gear Up for Third Annual Show

More than 250 gem, jewelry, and mineral companies are expected to exhibit, including the American Gem Trade Association.

Alexandra Rosier gold and opal Eternal Love Hands necklace
TrendsJun 02, 2023
Take a Peek at Couture’s Newest Design Talents

This year’s Design Atelier is full of gems.

Saboo Fine Jewels emerald and titanium earrings
CollectionsJun 02, 2023
Piece of the Week: Saboo Fine Jewels’ Emerald Earrings

They’re a testament to the power of excellent design.

LAB230043_Dossier_NJ_1872x1052_V1.jpg
Brought to you by
The Next Step for GIA Diamond Reports

The most trusted diamond report, available in print or the GIA App.

Holly Wesche, Stan Razny, Ingrid Razny, Candy Udell
IndependentsJun 02, 2023
These Are the 2023 Retailer Hall of Fame Inductees

This year’s honorees include one of Florida’s largest independent jewelers and two multi-store independents in the Chicago and New York areas.

Weekly QuizJun 02, 2023
This Week’s Quiz
Test your jewelry news knowledge with this short test.
Take the Quiz
Jane Taylor letter pendants
TrendsJun 01, 2023
See 50+ Jewels Debuting at Couture in Las Vegas

The industry’s most influential contemporary designers are showcasing their latest jewelry designs.

35-carat lab-grown diamond created by Maitri
Lab-GrownJun 01, 2023
35-Carat Lab-Grown Diamond Going on Display in Vegas

Created by Maitri Lab-Grown Diamonds and graded by IGI, it’s slightly bigger than the record-setting lab-grown diamond GIA just examined.

Cover-WN19-Back-&-Front_V5-RGB-(1)_Community.jpg
Brought to you by
Beyond Borders: Crucial Factors in Colored Stone Origin Determination

Navigate origin determination with Continuing Education seminars offered by the GIA Alumni Collective™.

Bottom Line Marketing Chief Growth Officer Gus Garcia and CEO Jackie Brooks
MajorsJun 01, 2023
Bottom Line Marketing Announces Restructured Leadership, New Service Offerings

The marketing agency has integrated its first C-suite.

20230306_JohnnyCupcakes.jpg
Events & AwardsJun 01, 2023
Meet JCK’s 2023 Keynote Speaker

The jewelry trade show also will debut educational content centered around social media.

Lauren K gold and gemstone rings
TrendsMay 31, 2023
Here’s a Sneak Peek of New Jewelry to Check Out at JCK

Luxury kicks off today, with the full show in swing on Friday.

A pearl pendant and a pearl ring
CollectionsMay 31, 2023
Verragio’s Debut Fine Jewelry Collections Honor Company Heritage

One of the three new collections was inspired by the legend of a woman who traded her mansion to Cartier for two strands of natural pearls.

Rob Ballew
MajorsMay 31, 2023
Signet Jewelers Names New Head of Investor Relations

Rob Ballew will be tasked with communicating the jewelry giant’s plans and financial performance to investors.

Mobile mock-up screens of the new LUX Digital Vault app from Jewelers Mutual Group
MajorsMay 31, 2023
Jewelers Mutual Launches App for Retailers, Introduces New Brokerage

With the app, customers receive a 15-day insurance offer on new purchases while their coverage needs are being evaluated.

Rendering of Lightbox lab-grown diamond store in House of Showfields
Lab-GrownMay 30, 2023
Lightbox Is Testing Out a Trendy Concept Shop in Brooklyn

It is in House of Showfields, a bazaar-style retail space in the borough’s Williamsburg neighborhood.

Attendees at the JCK Las Vegas show
Events & AwardsMay 30, 2023
These Are the Can’t-Miss JCK Talks Education Sessions

From consumer trends to retail technology, these are the JCK Talks sessions that should be on attendees’ radar.

Constance “Connie” Barber Mellon’s David Webb Elephant Clip-Brooch
AuctionsMay 30, 2023
Sotheby’s to Auction Mellon Family Jewelry

Signature pieces from Cartier and David Webb will appear in the June jewelry auction.

Georgie Gleim, Shelly Sergent, and Molly Peterson
Events & AwardsMay 30, 2023
24 Karat Club of Southern California Recognizes 3 Honorees

They will be celebrated at the annual dinner dance and gala in the fall.

Historic and modern photos of diamond grading GIA
GradingMay 26, 2023
State of the Diamond Industry: AI and the Future of Diamond Grading

Gemologists have long used machines in diamond grading but technology has made it possible for them to “learn” how to do it on their own.

Supplier Spotlight Webinar John Pollard and Garry Holloway
Recorded WebinarsMay 26, 2023
Watch: Diamond Cut Quality: The Final Frontier Part 2

Supplier Spotlight Sponsored by IGI

My Next Question webinar series episode on selling lab-grown diamonds
Recorded WebinarsMay 26, 2023
Natural and Lab-Grown Diamonds: What It’s Like to Sell Both

Watch retailers Jeffery Bolling and Bobby Bengivengo discuss employee training, customer education and the sticky subject of future value.

Bulgari necklace set with 118.35-carat unheated Sri Lankan sapphire
AuctionsMay 26, 2023
Piece of the Week: A Bulgari Sapphire and Diamond Necklace

Set with a 118-carat unheated Sri Lankan sapphire, it just sold for $3.4 million at Phillips jewelry auction in Hong Kong.

noamcarver-videoimage.png
Supplier BulletinMay 25, 2023
RAE Fine Jewelry Collection Debuting at JCK Luxury 2023

Sponsored by Noam Carver

Graphic of phishing scheme
TechnologyMay 25, 2023
State of Retail: Why Jewelers Need to Invest in Cybersecurity Now

As cybercrime incidents threaten the industry, jewelers need to know what they’re up against and the best ways to protect their businesses.

Louis Anthony Jewelers remodeled exterior
IndependentsMay 25, 2023
Louis Anthony Jewelers Is Remodeling and Expanding

The Pittsburgh jeweler is redoing the lighting and showcases, and adding a full hospitality bar as well as new shop-in-shops.

Yurman Family Crystalline Pass at American Museum of Natural History in New York City
SourcingMay 25, 2023
David Yurman Unveils Quartz Exhibition at AMNH

The Yurman Family Crystalline Pass is inside the museum’s brand-new Richard Gilder Center.

Stanley Zale new principal consultant Hill & Co.
MajorsMay 25, 2023
Stanley Zale Joins Hill & Co. as Principal Consultant

Zale has more than 40 years’ experience in the diamond industry, including 17 years as Stuller’s VP of diamonds and gemstones procurement.

×

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