HAMILTON, Bermuda, Jan. 14, 2021 /PRNewswire/ -- Signet Jewelers
Limited ("Signet") (NYSE:SIG), the world's largest retailer of
diamond jewelry, today announced its preliminary sales for the 9
weeks ended January 2, 2021 ("Holiday
Season").
"Despite considerable macro hurdles, the Signet team delivered
strong holiday performance – an achievement that demonstrates the
power of our multi-year Path to Brilliance transformation strategy
and the agility, innovation, and determination of our people," said
Virginia C. Drosos, Chief Executive
Officer. "Our results were driven by new digital and fulfillment
capabilities, increasingly personalized and insight-based
marketing, banner portfolio differentiation, and a strong
merchandising strategy that included competitive newness and a
strengthened core assortment -- all of which increased conversion,
attracted new customers, and increased market share. Our sales
momentum coupled with strong profit generation are reflective of
our team's excellent execution and new ways to help our customers
Celebrate Life and Express Love whenever and however they desire to
shop."
Holiday Season Fiscal 2021
Sales Highlights:
Signet's preliminary total sales for the
Holiday Season were $1.8 billion,
flat to last year. Preliminary same store sales
(SSS)1 improved 5.6% year over year. eCommerce
sales were up 60.8% year over year, while Signet's 2,866 stores (as
of January 2nd) reflect
brick and mortar SSS declined of 4.1%. As of January 2nd, the Company has closed 355 of its
planned 380 store closures this fiscal year.
By operating segment:
North America
- Preliminary SSS1 increased 7.8%. Transactions rose
4.4% and average transaction value increased 1.6%. Traditional mall
SSS1 were slightly negative while off-mall formats were
positive supporting the Company's real estate optimization
strategy.
- eCommerce sales grew 57.5% and brick and mortar sales declined
0.8% on a SSS basis.
- Both Bridal and Fashion category sales grew in the double
digits on a SSS1 basis reflecting competitive product
newness and strengthened core assortment.
International
- UK governmental lockdown resulted in a preliminary
SSS1 decline of 19.2% to last year, though the impact
was partially offset by 92.8% growth in eCommerce sales.
(1) Same store sales include physical store sales and
eCommerce sales.
Holiday Performance Highlights:
Expanded Digital and Fulfillment Capabilities
- New capabilities this Holiday Season include Buy Online Pick-up
In-Store (BOPIS), Ship from Store (SFS), virtual selling, faster
and more effective Customer Care assistance, and improved website
navigation, curation, and visualization. These strategic digital
innovations enhanced customer experience, improved conversion
rates, and added to Signet's ability to meet customers whenever and
however they choose to shop.
- Signet's quick increase of eCommerce fulfillment capacity to
five times that of last holiday, accuracy in forecasting and valued
relationships with distribution partners allowed the Company to
successfully deliver >98% of North
America customer orders on time this Holiday Season.
Advancing Banner Portfolio Differentiation
- All US banners posted positive same store sales, demonstrating
the Company's differentiated Banner Value Propositions and ability
to capture a broader customer base. Fashion growth was notably
strong at Zales and Piercing Pagoda, brands that are often
identified with fashion forward gifters and self-purchasers. Bridal
strength at Kay marked customer desire for sentimentality and
storytelling.
- Product assortment is one of the leading ways that Signet
differentiates its Banner Value Propositions. Newer bridal lines
such as Leo's Ideal Cut and First Light at Kay, as well as Royal
Asscher and Pnina Tornai at Jared
bring new ways for customers to express a timeless emotion.
Existing brands continue to convey emotions, through new and
on-trend pieces, such as tenderness through the Center of Me at Kay
and elegance through Vera Wang at
Zales.
- Signet's insight-based marketing efforts resonated with
customers to extend the holiday shopping season this year. The
Company's "Always On" marketing strategy, longer promotional
offers, and enhanced shopping and fulfillment options delivered
increasing momentum post Black Friday weekend.
Debt Paydown
- By the end of the Holiday Season, the Company paid down the
full balance of its ABL Revolving Facility.
Fourth Quarter Fiscal 2021 Guidance
- Same store sales up 4% to 5% with total sales of $2.10 to $2.12
billion
- Non-GAAP operating income of $255
- $270 million
Forecasted non-GAAP operating income provided above excludes
expected transformation charges of $8
to $12 million in the fourth quarter.
However, given the potential impact to the fourth quarter GAAP
operating income for items such as long-lived asset impairments, we
cannot provide forecasted GAAP operating income or the probable
significance of such items without unreasonable efforts. As such,
we do not present a reconciliation of forecasted non-GAAP operating
income to corresponding GAAP operating income. An appropriate
reconciliation will be provided in the Company's fourth quarter
earnings release. Please see disclosures within the Safe Harbor
Statement for other risk factors.
Non-GAAP Measures
The Company believes that the
presentation of non-GAAP financial measures, when reviewed in
conjunction with GAAP financial measures, can provide investors
with information to assist them in evaluating historical trends and
current period performance. For these reasons, internal management
reporting also includes non-GAAP measures. Items may be excluded
from GAAP financial measures when the Company believes this
provides greater clarity to management and investors. Non-GAAP
disclosures should not be viewed as a substitute for financial
results determined in accordance with GAAP, nor are they
necessarily comparable to non-GAAP performance measures that may be
presented by other companies.
Quarterly Dividend:
Signet's Board of Directors has
elected to maintain the temporary suspension of the dividend
program on the common shares and has elected to pay the February
quarterly dividend on its preference shares in kind.
About Signet and Safe Harbor Statement:
Signet
Jewelers Limited is the world's largest retailer of diamond
jewelry. Signet operates approximately 2,900 stores primarily under
the name brands of Kay Jewelers, Zales, Jared, H.Samuel,
Ernest Jones, Peoples, Piercing
Pagoda, and JamesAllen.com. Further information on Signet is
available at www.signetjewelers.com. See also www.kay.com,
www.zales.com, www.jared.com, www.hsamuel.co.uk,
www.ernestjones.co.uk, www.peoplesjewellers.com, www.pagoda.com,
and www.jamesallen.com.
This release contains statements which are forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. These statements, based upon management's
beliefs and expectations as well as on assumptions made by and data
currently available to management, appear in a number of places
throughout this document and include statements regarding, among
other things, Signet's results of operation, financial condition,
liquidity, prospects, growth, strategies and the industry in which
Signet operates. The use of the words "expects," "intends,"
"anticipates," "estimates," "predicts," "believes," "should,"
"potential," "may," "preliminary," "forecast," "objective," "plan,"
or "target," and other similar expressions are intended to identify
forward-looking statements. These forward-looking statements are
not guarantees of future performance and are subject to a number of
risks and uncertainties which could cause the actual results to not
be realized, including, but not limited to: the negative impacts
that the COVID-19 pandemic has had, and will continue to have, on
Signet's business, financial condition, profitability and cash
flows; the effect of steps we take in response to the pandemic; the
severity and duration of the pandemic, including whether it is
necessary to temporarily reclose our stores, distribution centers
and corporate facilities or for our suppliers and vendors to
temporarily reclose their facilities; the pace of recovery when the
pandemic subsides and the heightened impact it has on many of the
risks described herein, including without limitation risks relating
to disruptions in our supply chain, consumer behaviors such as
spending and willingness to congregate in shopping centers and the
impact on demand of our products, our level of indebtedness and
covenant compliance, availability of adequate capital, our ability
to execute our business plans, our lease obligations and
relationships with our landlords, and asset impairments; general
economic or market conditions; financial market risks; our ability
to optimize Signet's transformation initiative; a decline in
consumer spending or deterioration in consumer financial position;
changes to regulations relating to customer credit; disruption in
the availability of credit for customers and customer inability to
meet credit payment obligations; our ability to achieve the
benefits related to the outsourcing of the credit portfolio sale
due to technology disruptions, future financial results and
operating results and/or disruptions arising from changes to or
termination of the non-prime outsourcing agreement requiring
transition to alternative arrangements through other providers or
alternative payment options; deterioration in the performance of
individual businesses or of the Company's market value relative to
its book value, resulting in impairments of long-lived assets or
intangible assets or other adverse financial consequences; the
volatility of our stock price; the impact of financial covenants,
credit ratings or interest volatility on our ability to borrow; our
ability to maintain adequate levels of liquidity for our cash
needs, including debt obligations, payment of dividends, and
capital expenditures as well as the ability of our customers,
suppliers and lenders to access sources of liquidity to provide for
their own cash needs; changes in our credit rating; potential
regulatory changes, global economic conditions or other
developments related to the United
Kingdom's exit from the European Union; exchange rate
fluctuations; the cost, availability of and demand for diamonds,
gold and other precious metals; stakeholder reactions to disclosure
regarding the source and use of certain minerals; seasonality of
Signet's business; the merchandising, pricing and inventory
policies followed by Signet and failure to manage inventory levels;
Signet's relationships with suppliers including the ability to
continue to utilize extended payment terms and the ability to
obtain merchandise that customers wish to purchase; the failure to
adequately address the impact of existing tariffs and/or the
imposition of additional duties, tariffs, taxes and other charges
or other barriers to trade or impacts from trade relations; the
level of competition and promotional activity in the jewelry
sector; the development and maintenance of Signet's OmniChannel
retailing and ability to increase digital sales; changes in
consumer attitudes regarding jewelry and failure to anticipate and
keep pace with changing fashion trends; changes in the supply and
consumer acceptance of and demand for gem quality lab created
diamonds and adequate identification of the use of substitute
products in our jewelry; ability to execute successful marketing
programs and manage social media; the ability to optimize Signet's
real estate footprint; the ability to satisfy the accounting
requirements for "hedge accounting," or the default or insolvency
of a counterparty to a hedging contract; the performance of and
ability to recruit, train, motivate and retain qualified sales
associates; management of social, ethical and environmental risks;
the reputation of Signet and its banners; inadequacy in and
disruptions to internal controls and systems, including related to
the migration to a new financial reporting information technology
system; security breaches and other disruptions to Signet's
information technology infrastructure and databases; an adverse
development in legal or regulatory proceedings or tax matters,
including any new claims or litigation brought by employees,
suppliers, consumers or shareholders, regulatory initiatives or
investigations, and ongoing compliance with regulations and any
consent orders or other legal or regulatory decisions; failure to
comply with labor regulations; collective bargaining activity;
changes in taxation laws, rules or practices in the US and
jurisdictions in which Signet's subsidiaries are incorporated,
including developments related to the tax treatment of companies
engaged in Internet commerce; risks related to international laws
and Signet being a Bermuda
corporation; difficulty or delay in executing or integrating an
acquisition, business combination, major business or strategic
initiative; risks relating to the outcome of pending litigation;
our ability to protect our intellectual property or physical
assets; changes in assumptions used in making accounting estimates
relating to items such as extended service plans and pensions; the
success of recent changes in Signet's executive management team; or
the impact of weather-related incidents, natural disasters,
strikes, protests, riots or terrorism, acts of war or another
public health crisis or disease outbreak, epidemic or pandemic on
Signet's business.
For a discussion of these and other risks and uncertainties
which could cause actual results to differ materially from those
expressed in any forward looking statement, see the "Risk Factors"
and "Forward-Looking Statements" sections of Signet's Fiscal 2020
Annual Report on Form 10-K filed with the SEC on March 26, 2020 and quarterly reports on Form 10-Q
and the "Safe Harbor Statements" in current reports on Form 8-K
filed with the SEC. Signet undertakes no obligation to update or
revise any forward-looking statements to reflect subsequent events
or circumstances, except as required by law.
Investors:
Vinnie Sinisi
SVP Investor Relations & Treasury
+1-330-665-6530
vincent.sinisi@signetjewelers.com
Media:
Colleen Rooney
Chief Communications Officer
+1-330-668-5932
colleen.rooney@signetjewelers.com
David Bouffard
VP Corporate Affairs
+1-330-668-5369
david.bouffard@signetjewelers.com
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SOURCE Signet Jewelers Ltd.