Signet profits plunge
Pre-tax profit down by almost 28 per cent.
H Samuel and Ernest Jones group saw like for like sales for the 26 weeks ended 2 August fall by 3.4 per cent and total sales fall 0.6 per cent to $1.59bn, hitting pre-tax profit by almost 28 per cent to $78.7m. The US business, which accounts for almost 75 per cent of sales, saw a 5.2% decline in like for like sales and 0.8% fall in total sales to $1.21bn.
There was little change in sales in the UK, steady at $384.7m, but they rose 2.4 per cent at H Samuel on a like for like basis and by 2.2 per cent at Ernest Jones.
Terry Burman, Group Chief Executive, commented ‘The Group’s strong balance sheet and superior operating metrics on both sides of the Atlantic enables the business to continue to implement its proven strategy. Appropriate adjustments in execution are being made to reflect the challenging economic conditions with tight control of costs, inventory, gross merchandise margin and investment in new space. As a result, the business will be well positioned when the economy improves. However, in the short term, the consumer environment in both the US and the UK remains very challenging. As always, the results for the year will be significantly influenced by the Group’s performance during the important Christmas period.’
It is expected that in 2008/09 US net new store space will increase by about 4 per cent, including the closure of about 50 mall brand stores as leases expire. Capital expenditure in new and existing stores is planned to be circa $60 million (2007/08: $88 million).
