Signet Group Same Store Sales Decline 15%

Signet Jewelers Ltd reported a sharp decline in sales in the nine weeks to January 3, covering the 2008 holiday season. Total sales fell by 19.4 percent on a reported basis and by 13.1 percent at constant exchange rates.

Group same store sales, sales at stores open for more than a year, declined by 15.2 percent during the period.

U.S. same store sales, accounting for about 75 percent of group sales, declined by 16.4 percent and total sales fell by 14 percent. The average selling price decreased in both Jared and the mall brand stores. Gross merchandise margin increased by about 250 basis points over the comparable period last year, the retailer added.

UK same store sales declined by 10.9 percent, with total sales dropping 33.4 percent on a reported basis and by 9.7 percent at constant exchange rates. Signet reported that the average selling price was up in both H.Samuel and Ernest Jones. 

Watch participation increased in H.Samuel and the merchandise mix in Ernest Jones was little changed. Gross merchandise margin is anticipated to be about 110 basis points below last year's level because of limited additional discounting and mix changes. For the year as a whole, gross merchandise margin is in line with last year.

Annually, Group Chief Executive Terry Burman expects profits to be within the range of market forecasts. “While Group same store sales were very disappointing, being down 15.2% over the nine week period, gross merchandise margin was substantially ahead of last year and costs were very tightly controlled,” Burman said in a company release.

For the year, same store sales declined by 8.1 percent. Total sales decreased by 8.3 percent on a reported basis and by 5.5 percent at constant exchange rates. Income before income tax is expected to be between $180 million and $195 million after charging $10.5 million of costs related to the change in domicile of the company.