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Thursday, January 7, 2016

Signet Jewelers Holiday Sales Up 5%, Same Store Sales Up 4.9%

Kay Jewelers, the largest specialty retail jewelry store in the US based on sales, posted a year-over-year 8.9 percent increase in sales to $778 million.

Signet Jewelers Limited said Thursday that year-over-year sales increased 5 percent to nearly $1.95 billion for the eight-week holiday period ended December 26. Total sales for the period at constant exchange rates increased 6.3 percent compared to the prior year.

Holiday same-store sales increased an equally impressive 4.9 percent compared to an increase of 3.6 percent in the prior year. This was driven primarily by mall-based and outlet concepts in the US as well as Ernest Jones stores in the UK, the company said.

Signet’s e-commerce sales for the holidays increased 10.9 percent to $139.7 million.

Signet bills itself as “the world's largest retailer of diamond jewelry” operating approximately 3,600 stores and eCommerce properties in the US, UK, Canada and Puerto Rico primarily under the name brands of Kay Jewelers, Zales, Jared The Galleria Of Jewelry, H.Samuel, Ernest Jones, Peoples and Piercing Pagoda.

Mark Light, Signet CEO, said in a statement the positive results “were driven by broad-based success across strategic store brands, merchandise categories and selling channels…. The continuation of strong sales and profitability combined with operating expenses that were in-line with expectations, including as-anticipated credit-related expense trends, enabled us to narrow our fourth quarter earnings guidance as well as our same store sales guidance to the top end of the previously provided guidance.”

In a conference call with investors this morning Light was particularly upbeat regarding its “Ever Us” two-diamond ring promotion that was used for several of the company’s brands, including Kay, Zale and Jared in the US, H.Samuels and Ernest Jones in the UK. Light said it was the biggest new launch in Signet’s history and did well in all the stores in the US and UK that carried the program.

“Most importantly, it crosses over gift giving categories and we are excited by that,” Light added.

Nearly all of Signet’s US properties did well during the holidays led by Kay Jewelers, the largest specialty retail jewelry store in the US based on sales, which posted a year-over-year 8.9 percent increase in sales to $778 million. Same store sales for the middle-market retail jeweler were 7.2 percent.

Zales US jewelry stores saw a 6 percent increase in sales to $400.2 million and a 5.6 percent growth in same store sales.

In the UK Ernest Jones same store sales increased 6.9 percent, while total sales were up 4.9 percent to $98 million (9 percent at constant exchange rates).

Only Signet’s Canadian operations suffered losses for the holiday season. Revenues in Canada and the UK were negatively impacted by exchanges rates.

Fourth quarter financial guidance was adjusted upward and is as follows:

* Same store Sales 4.6 percent to 5 percent
* Earnings per Share $3.44 to $3.50
* Adjusted Earnings per Share $3.54 to $3.60

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