Signet Announces Record Results, Plans to Open More Than 65 New Stores

Signet Jewelers reported record results for fiscal 2013, and plans to open 65–75 new stores in the United States over the next year.

The company’s operating income in the fiscal year set a new high, hitting $560.5 million, up 10.5 percent from the previous year. Overall company sales hit $3.9 billion, up 6.2 percent. Same store sales jumped 3.3 percent. 

Most of the same-store growth over the fiscal period came from American chains Kay and Jared, while sales fell at the company’s regional brands. Comps rose 0.3 percent at its U.K. stores.

Its numbers for the fourth quarter (ended Jan. 28, 2012) were particularly strong, with total sales rising 11.8 percent and same-store sales climbing 3.5 percent. It expects sales to rise from 5 to 7 percent in the first quarter of 2014.

In the United States, the company opened 53 stores in the last year—46 Kay stores and 7 Jareds—and closed 17 Kays. It also closed 21 regional brand stores, about 10 percent of the total.

Among the things driving growth in the past year were sales of proprietary branded products, such as its Neil Lane, Jane Seymour, and Le Vian lines, which grew 9.7 percent. Branded products now account for 27.4 percent of the company’s sales mix. 

E-commerce sales grew an impressive 40.6 percent over the year, to $129.8 million.

The company is experimenting with digital initiatives such as giving sales associates touch-screen tablets for the sales floor, said CEO Michael Barnes in a conference call following the release of the company’s financial results.

“Those were highly successful sales tools,” he said.

Also this fiscal year, the company acquired outlet chain Ultra Stores, and is in the process of rebranding the company’s stores as Kay Outlets.

“The goal is to be the number one jeweler in outlet malls,” said Barnes. “We really are marrying the leverage and the equity we have with the Kay brand name along with the expertise that Ultra has.”

Regarding Ultra’s leased departments in stores like the Burlington Coat Factory, Barnes said, “We’re still in the learning stages of operating those. We will talk more about that if we see anything change in the future.”

The company also announced it is expanding its rough diamond sourcing initative, with chief financial officer Ronald Ristau telling an analyst “we will be buying more and more rough diamonds.” 

Highlights of Signet’s operating results for fiscal 2013:

  • Overall sales: $3.9 billion, up 6.2%   
  • Overall net income: $560.5 million, up 10.5%
  • Same-store sales: Up 3.3%
  • Diluted earnings per share: $4.35, up 16.6%
  • U.S division total sales: $3.2 billion
  • U.S. division net operating income: $547.8 million, up 14.6%
  • Kay total sales: $1.93 billion, up 9.3%
  • Kay same store sales: Up 6.4%
  • Jared total sales: $1.0 billion, up 4.8%
  • Jared same-store sales: Up 1.6%
  • Sales from Ultra division: $45.7 million
  • Regional brands: $271.8 million, down 6.4%
  • Regional brands same-store sales: Down 3.4%

See Signet’s full statement on its operating results.

JCK News Director