Signet posts 19.8% sales gain; Sterling sales down 1.3%

William George Shuster, JCK Senior Editor -- JCK Online, 8/10/2001 8:49:00 AM

The Signet Group, the world's second largest retail jeweler and parent of Sterling Inc., in the United States, posted a 19.8% increase in group sales to about $898.3 million and a 1.7% gain in comparable store sales for its half of the year (ended July 28).

Signet, headquartered in London, operates 1,606 retail jewelry stores, including 599 in the United Kingdom under the names H Samuel, Ernest Jones and Leslie Davis) and 1,007 in the United States through its Sterling Inc. Division, under the names of Kay Jewelers, the Jared Galleria superstores and a number of regional chains.

Sterling, based in Akron, Ohio, the second largest U.S. jewelry retailer, rang up $660.2 million (three-fourths of Signet's revenues) for the first half of the year, a 24.1% gain over the previous fiscal year. However, comparable store sales (i.e., stores in operation at least a year) were down 1.3%. The British segment posted about $238.1 million, a 9.2% gain. Same store sales were up 10%.

For the second quarter alone, Signet sales increased 16.7%, to about $452.6 million, while same-store sales barely moved, at 0.1%. Sterling's second quarter revenues tallied $329.2 million, a 20.2% gain, but same store sales were down 3.4%, continuing a trend that began towards the end of the first quarter due to what Signet officials call "challenging economic conditions" in the United States. The British stores posted about $123.4 million, a 9.2% increase; same-store sales went up 9.3%.

"The first half clearly highlights the inherent strength of Signet's geographic balance," said Terry Burman, Signet's chief executive and chairman of Sterling.

Despite the United Kingdom business' smaller size [within the Group], its strong sales performance more than made up for the negative impact on like-for-like [i.e., same store] sales of the difficult U.S. trading environment.

"While a decline in like-for-like sales always disappoints," he continued, "we take some satisfaction from a further gain in market share and the continued resilience of our business compared to the competition.' Burman noted also that "both margins and costs remain under very focused control."