Signet sales fall prompts cash and costs focus

Like-for-likes tumbled 14.9 per cent at group level in the 13 weeks to January 31, when total sales slid 18.9 per cent on a reported basis and 12.8 per cent at constant exchange rates.

In the US, comparable store sales fell 16.1 per cent. UK like-for-likes declined 9.2 per cent, reflecting a 7.8 per cent fall at H Samuel and an 11 per cent slump at Ernest Jones.

Signet chief executive Terry Burman said the US division had faced “an extremely challenging and highly promotional environment” but maintained: “Against this background, same-store sales outperformed the competition and gross merchandise margin rate showed a significant increase.”

Burman continued: “The UK division experienced trading conditions similar to those in the US, with both H Samuel and Ernest Jones reporting a step-down in sales performance compared to the first nine months of the year.

“Therefore, on both sides of the Atlantic, we are reducing costs and focusing on cash generation.”

In the 52 weeks to January 31, group same-store sales fell 8.2 per cent to come in at US$3.34bn (£227.51bn).

Signet had already reported on its Christmas period and analysts were unsurprised by the quarterly update. Investec analyst David Jeary said: “Weaker competitors are failing, with consequent capacity withdrawal. Signet will be a longer-term winner.”