Early Holiday Shoppers Bolster Signet’s Q3 Sales

FinancialsDec 03, 2020

Early Holiday Shoppers Bolster Signet’s Q3 Sales

The company geared up for the holiday rush, equipped with five times the shipping capacity it had this time last year.

Signet’s same-store sales were up 15 percent in the third quarter. The retailer is offering in-store, online, “Buy Online, Pick-Up in Store,” services and curbside delivery options for the holiday season. (Photo courtesy of Signet Jewelers)
Akron, Ohio—Signet Jewelers Ltd.’s sales posted strong third-quarter results with sales and same-store sales climbing double digits.

In the third quarter ending Oct. 31, sales totaled $1.3 billion, up 10 percent year-over-year, with same-store sales climbing 15 percent, the retailer reported Thursday morning.

Brick-and-mortar sales were up 7 percent. Online sales were up 71 percent year-over-year to $238.8 million.

Year-to-date, Signet’s sales have totaled $3.04 billion, down 24 percent year-over-year, with same-store sales sliding 20 percent.

"Our success came from a combination of factors including significant digital, product, and marketing innovations; our ability to capture pent-up demand as our stores reopened; and intentional efforts to capture early holiday shopping to help mitigate traditionally high in-store traffic days in December,” said CEO Gina Drosos in a press release.

Signet has been growing its digital capabilities, implementing a full-time virtual selling team to work virtually with customers from their homes or in stores. A total of 600,000 virtual appointments have been held so far.

“When consultants are involved, we see higher conversion rates and higher transaction value,” said Drosos on an earnings call Thursday morning.

In North America, where Signet’s banners include Kay, Jared and Zales, third-quarter same-store sales were up 16 percent to $1.18 billion.

Brick-and-mortar same-store sales in the region were up 8 percent, while online sales were up 73 percent.

The average transaction value (ATV) was up about 1 percent while the number of transactions was up 14 percent.

In the U.K., same-store sales were up 8 percent.

Brick-and-mortar sales rose about 1 percent while e-commerce sales were up 58 percent. ATV increased 18 percent while the number of transactions dropped 8 percent.

Product-wise, Drosos noted the popularity of brands like Neil Lane, Le Vian, and Vera Wang as well as its newer launches, like its collaboration with bridal gown designer Pnina Tornai and the Royal Asscher collection.

Customized pieces and sentimental gifts, including the Everything You Are line, available at Kay Jewelers and Zales, are also performing well.

Sales in the bridal category rose 13 percent to $612.5 million year-over-year in the third quarter and fell 22 percent to $1.4 billion in the first nine months.

Sales of fashion jewelry were up 16 percent to $420.2 million year-over-year in the third quarter and fell 21 percent to $1.04 billion in the year so far.

In the watches category, quarterly sales were down 13 percent to $67 million year-over-year and down 38 percent to $155.2 million so far this year.

By banner, Piercing Pagoda was the star of the show with quarterly sales climbing 37 percent to $93.7 million. Year-to-date sales were down 9 percent to $204.4 million.

E-tailer James Allen posted quarterly sales of $76.6 million, up 26 percent year-over-year. Year-to-date sales were up 11 percent to 184.7 million.

Zales’s quarterly sales were up 13 percent to $251.4 million while year-to-date sales were down 22 percent to $618.8 million.

Jared’s quarterly sales rose 10 percent to $232.7 million. Year-to-date sales were down 24 percent to $546.6 million.

Kay Jewelers posted quarterly sales of $490.5 million, up 4 percent year-over-year. Year-to-date sales were down 27 percent to $1.15 billion.

Looking at its store count, Signet had 2,893 stores, 22 fewer than the previous third quarter and 315 fewer than the end of fiscal 2020. There will be 380 closures in total for the fiscal year.

As for the holiday season ahead, Signet said same-store sales were up 3 percent so far in the fourth quarter through Nov. 30.

The company has five times the shipping capacity it did last year in preparation for a rise in orders.

For the Thanksgiving weekend, same-store sales were down by low single digits due to weak retail store traffic, though it was somewhat offset by higher conversion rates, a shift to the digital platform, and higher transaction value.

However, the two weeks leading up to Christmas are the strongest for the company, said Signet, adding that same-store sales could be hurt by low traffic, COVID-19 social distancing capacity constraints, and store closures in response to the pandemic.

The company declined to provide financial guidance for the remainder of fiscal 2021 and said it believes the pandemic will have “a more significant negative effect” in December than November.

Signet will announce its holiday sales results Jan. 14, 2021.
Lenore Fedowis the associate editor, news at National Jeweler, covering the retail beat and the business side of jewelry.

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