LONDON, April 9, 2008 /PRNewswire-FirstCall/ -- Signet Group plc
(LSE and NYSE: SIG) today released annual results for the 52 weeks
ended 2 February 2008. Reported Constant exchange rate 52 weeks
comparative basis(1) -- Group like for like sales down 0.7% --
Group total sales: $3,665.3m up 3.0% up 3.2% - Group profit before
tax: $333.5m down 16.8% down 17.4% -- Basic earnings per share:
12.6 cents down 18.2% down 18.7% -- Annual dividend per share:
7.277 cents(2) up 1.6% (1) See note 11 for reconciliation. (2)
2006/07 interim dividend paid in pounds sterling, see note 8 for
translation assumption. Divisional Highlights -- US: - Kay
strengthened its No.1 speciality brand position with sales of
$1,489.6m, c.40% greater than No.2 middle market speciality brand -
Jared sales up 13.8% to $756.4m, national network TV advertising
commenced - Net space growth of 10% -- UK: - c.50% of sales from
customer oriented store format - H.Samuel benefited from more
effective marketing - Ernest Jones successfully tested enhanced
store design Terry Burman, Group Chief Executive, commented:
"2007/08 was a very demanding year for the Group, with a
particularly difficult fourth quarter. While the US business saw an
unprecedented weakening in sales over Christmas, and faced the
impact of commodity cost increases, it continued to be a leader in
setting industry operating standards. In a tough UK retail
marketplace, like for like sales were ahead and operating margins,
cash flow and return on capital remained strong. In consideration
of the uncertain economic environment, actions have been identified
to drive sales, protect gross margin, and tightly control costs.
The Group's demanding investment hurdle rate continues to be
applied, and as a result US net store space growth is expected to
be lower at about 5% in 2008/09. Since the start of 2008/09, the
Group has experienced a low single digit decline in like for like
sales, with the US down about 4%, having had some benefit from
better weather over Valentine's Day. Early results have been
encouraging from the price increases implemented after Valentine's
Day in the US. UK like for like sales were up mid single digits.
However, the outlook remains very challenging on both sides of the
Atlantic. As previously announced, the Board has undertaken a
review of the most appropriate domicile and stock market listing
for the Company. Following consultation with major investors, the
Board believes that shareholders would, on balance, approve a move
of the primary listing of Signet to the US. Accordingly the Board
continues to take steps that would facilitate such a change.
However, in light of market conditions, the determination and
timing of any such proposal remains uncertain and will continue to
be kept under review by the Board." Enquiries: Terry Burman, Group
Chief Executive +44 (0) 20 7317 9700 Walker Boyd, Group Finance
Director +44 (0) 20 7317 9700 Jonathan Glass, Brunswick +44 (0) 20
7404 5959 Wendel Verbeek, Brunswick +44 (0) 20 7404 5959 Signet
operated 1,962 speciality retail jewellery stores at 2 February
2008; these included 1,399 stores in the US, where the Group trades
as "Kay Jewelers", "Jared The Galleria Of Jewelry", and under a
number of regional names. At that date Signet operated 563 stores
in the UK, where the Group trades as "H.Samuel", "Ernest Jones",
and "Leslie Davis". Further information on Signet is available at
http://www.signetgroupplc.com/. See also http://www.kay.com/,
http://www.jared.com/, http://www.hsamuel.co.uk/ and
http://www.ernestjones.co.uk/. Chairman's Statement Group
performance The Group continued to make progress in implementing
its proven growth strategy despite the difficult economic
environment. While the Group saw a decline in profits, it still
achieved a superior operating performance for the jewellery sector
including a healthy operating margin and Return on Capital Employed
("ROCE"). Key financial results of the year included: -- Sales up
by 3.0% to $3,665.3 million; -- Profit before tax down by 16.8% to
$333.5 million; -- Basic earnings per share down by 18.2% to 12.6
cents, and -- ROCE of 16.8%. The Board is pleased to recommend a
final dividend of 6.317 cents per share (2006/07: 6.317 cents).
This represents a total dividend for the year of 7.277 cents, up by
1.6% (see note 8). During the year the Group made share repurchases
of $29.0 million, completing the programme announced in July 2006.
In total, $152.9 million was distributed to shareholders during
2007/08. Given the substantial increase in economic and financial
sector uncertainties, the Board will continue to evaluate dividend
policy in the light of the needs of the business, taking into
consideration the significant competitive advantages of a strong
balance sheet and financial flexibility. Account will also be taken
of the primary stock market listing of the Company. Group strategy
The Group aims to build long term value through focusing on the
customer by providing a superior merchandise selection in high
quality real estate locations. Effective advertising draws
consumers into our stores, where they are provided with outstanding
service. The operating philosophies that help the Group achieve
these aims are: -- excellence in execution; -- test before we
invest; -- continuous improvement; and -- disciplined investment.
The Group's strategy to deliver shareholder value is to: --
continue to achieve sector leading performance standards on both
sides of the Atlantic; -- increase store productivity in the US and
the UK; -- grow new store space in the US; and -- maintain a strong
balance sheet. While progress was made in most of these areas,
store productivity in the US declined in 2007/08 as a result of the
sales performance in the fourth quarter. A more detailed
consideration of these strategies is provided in the Chief
Executive's, US and UK performance reviews. Group domicile and
primary listing As set out in the trading statement dated 10
January 2008, the Board has undertaken a review of the most
appropriate domicile and stock market listing for the Company. This
review has confirmed that there is a clear rationale for the
primary listing of the Group to be in the US as a significant and
growing majority of its business and assets are in that country.
From consultation with the Company's major investors, the Board
believes that Signet's shareholders would, on balance, support a
recommendation from the Board regarding a potential redomicile of
the Company to Bermuda and a move of the primary listing of
Signet's shares to the US. Accordingly the Board continues to take
steps that would facilitate such a change. However, in light of
market conditions, the determination and timing of any such
proposal remains uncertain and will continue to be kept under
review by the Board. Corporate responsibility During the year
further progress was made in developing industry wide initiatives
to achieve improvements in the supply chain, and with regard to
social, ethical and environmental issues. In keeping with the
Group's approach of working with other industry representatives to
maintain and improve consumer confidence in our industry we worked
with organisations such as the Council for Responsible Jewellery
Practices ("CRJP"), the World Diamond Council, Jewelers of America
and Jewelers Vigilance Committee to develop programmes to improve
the supply chain. Major accomplishments include: -- implementation
of a requirement that jewellery supplied to the Group should not
contain rubies or jade from Burma. Jewelers of America also
introduced the same requirement and advocated that the US
government ban such imports; -- the development of a Code of
Practices by the CRJP which includes future third party monitoring.
It is anticipated that during 2008/09 the Code will be introduced;
and -- a better understanding of the Group's impact on the
environment and on identifying ways in which it can improve its
performance. Signet remains a member of the FTSE4Good Index and
also contributed in the US, to the industry charity, Jewelers for
Children, St. Judes Children's Research Hospital and in the UK, to
the Princess Royal Trust for Carers. Current trading Since the
start of 2008/09, the Group has experienced a low single digit
decline in like for like sales, with the US down about 4%, having
had some benefit from better weather over Valentine's Day. Early
results have been encouraging from the price increases in the US
implemented after Valentine's Day. UK like for like sales were up
mid single digits. However, the outlook remains very challenging on
both sides of the Atlantic. People I would like to thank our staff
and management for their hard work and dedication in a year when
the external environment has placed increased pressures on the
business. I would also like to thank Brook Land, who retires as a
director at the 2008 annual general meeting, for his significant
contribution. He has served on the Board for nearly 13 years,
including six as senior independent director. Following his
retirement Russell Walls will assume this role. In addition, I
would like to welcome Lesley Knox, who was appointed as a
non-executive director in January 2008. I am confident that her
broad experience of business and corporate finance will enable her
to make a valuable contribution to the Group. Chief Executive's
Review Change at Like constant for like exchange change rates on a
on a 2007/08 2006/07 Change 52 week 52 week 52 weeks 53 weeks
reported basis basis $m $m % % % Sales 3,665.3 3,559.2 3.0 3.2
(0.7) Operating profit 351.3 416.2 (15.6) (15.9) Profit before tax
333.5 400.8 (16.8) (17.4) Basic earnings per share 12.6c 15.4c
(18.2) (18.7) Operating margin 9.6% 11.7% ROCE 16.8% 22.8% (1) See
note 11 for reconciliation of impact of exchange rates and
adjustment for 53rd week in 2006/07. 2007/08 was a very demanding
year for the Group, with a particularly difficult fourth quarter.
Although execution within the business continued to improve, the
economic environment deteriorated. The speed and extent of the
change in trading conditions during the fourth quarter was
unprecedented. As a result there was very limited time to align the
business to reflect the change in market conditions and therefore
the impact on results could not be meaningfully mitigated. In the
year to 2 February 2008 total sales rose by 3.2% at constant
exchange rates on a 52 week basis (see note 11); the reported
increase was 3.0% to $3,665.3 million (2006/07: $3,559.2 million).
Like for like sales declined by 0.7%, the first annual decrease
since 1992/93. The average exchange rate for 2007/08 was 1
pound/$2.00 (2006/07: 1 pound/$1.88). Operating profit fell by
15.9% at constant exchange rates on a 52 week basis (see note 11);
the reported decrease was 15.6% to $351.3 million (2006/07: $416.2
million). Operating margin was 9.6% (2006/07: 11.7%). Profit before
tax was down by 17.4% at constant exchange rates on a 52 week basis
(see note 11) and by 16.8% on a reported basis to $333.5 million
(2006/07: $400.8 million). The tax rate was 35.5% (2006/07: 33.6%).
Basic earnings per share were 12.6 cents (2006/07: 15.4 cents, the
53rd week contributing 0.1 cents in 2006/07). ROCE was 16.8%
(2006/07: 22.8%). Net debt at 2 February 2008 was $374.6 million (3
February 2007: $233.2 million). Gearing (net debt to total equity)
was 20.7% (3 February 2007: 13.4%). Given that nearly all stores
are leased, a further important measure of gearing is fixed charge
cover, which was 1.8 times in 2007/08 (2006/07: 2.0 times). The
increase in net debt before exchange adjustments was $143.6 million
(2006/07: $86.4 million), reflecting the lower level of
profitability, investment in new store space of $178.9 million
(2006/07: $176.7 million) and distribution to shareholders of
$152.9 million (2006/07: $172.1 million). It is critical to build
the long term competitive position of the business while managing
short term pressure on profitability and the balance sheet during
challenging economic periods. A very thorough review of the
businesses on both sides of the Atlantic has been carried out
following the difficult 2007 Christmas period. In consideration of
the uncertain economic environment a more cautious approach to the
execution of the Group's growth strategy has been adopted.
Reflecting this, management focus is more on implementation and
responding rapidly to changes in the marketplace, with less
attention on developing longer term operational initiatives. As
part of this process, actions have been identified to drive sales,
protect gross margin, control costs tightly and, where appropriate,
to realign the Group's cost base and inventory levels to the
changed market conditions. The Board firmly believes that a strong
balance sheet, and financial flexibility, are competitive
advantages. Therefore it has carefully considered the appropriate
working capital levels, investment required to maintain the quality
of the Group's assets and rate of space growth, as well as its
distribution policy to shareholders. A strong balance sheet enables
the Group to continue to invest in the business throughout the
economic cycle enhancing further its strong competitive position
within the marketplace. Investment to reinforce the Group's
strategic advantages remain in place, such as the expansion of Kay
and Jared, the development of the rough diamond supply chain
initiative, as well as the Ernest Jones refurbishment programme.
Demanding investment hurdle rates continue to be applied, and as a
result US net store space growth is expected to be about 5% in
2008/09 and 2009/10, which is below the 8% to 10% per annum long
term target range. However, an increased level of UK store
refurbishment in 2008/09 is expected to result in a broadly
unchanged level of Group capital expenditure, of approximately $140
million. The anticipated reduction in working capital investment,
lower tax payments and the absence of share repurchases are
expected to result in a significant reduction in cash outflow
during 2008/09. US performance review (74% of Group sales) Like for
like Change change on a on a 2007/08 2006/07 Change 52 week 52 week
52 weeks 53 weeks reported basis(1) basis $m $m % % % Sales(2)
2,705.7 2,652.1 2.0 4.1 (1.7) Operating profit 262.2 326.7 (19.7)
(19.6) Operating margin(2) 9.7% 12.3% ROCE 14.9% 21.5% (1) See note
11 for reconciliation of impact of 53rd week in 2006/07. (2) See
Group financial review for tables analysing total sales growth and
movement in operating margin. In a much more demanding trading
environment the consistency of the US division's management,
strategy and execution, as well as the Group's strong balance sheet
were significant competitive advantages. While the US business saw
an unprecedented weakening in sales in the fourth quarter and faced
the impact of commodity cost increases, it continued to be a leader
in setting industry operating standards. A further increase in net
new space of 10% was achieved, at the top end of the target range.
Like for like sales growth slowed in the first nine months of
2007/08 to 2.7%, with the gift giving events of Valentine's Day and
Mother's Day being disappointing. The very important fourth quarter
was particularly difficult with like for like sales declining by
8.6%, resulting in a full year decline of 1.7%. Total sales
increased by 4.1% on a 52 week basis (see note 11) and by 2.0% as
reported. Operating profit was down by 19.6% on a 52 week basis
(see note 11) and by 19.7% as reported, to $262.2 million (2006/07:
$326.7 million). The operating margin of 9.7% (2006/07: 12.3%;
12.5% on a 52 week basis) reflected expense deleverage of 190 basis
points as a result of the decline in like for like sales, and the
adverse impacts of additional new space (60 basis points) and
change in gross margin (30 basis points). The movement in gross
margin percentage was due to the significantly higher cost of gold
and a greater proportion of sales from Jared, partly offset by
supply chain initiatives and some limited price increases. The bad
debt charge of 3.4% of total sales (2006/07: 2.8%), was at the high
end of the range of the last ten years, but was largely offset by
higher income associated with the receivables due to a lower
monthly collection rate. The proportion of sales through the
in-house credit card was 52.6% (2006/07: 51.7%). ROCE was 14.9%
(2006/07: 21.5%), reflecting the lower operating profit and
investment in a 10% increase in space. The proportion of stores
under six years old continued to increase and was 38% in 2007/08
compared to 32% in 2006/07. The higher proportion of immature
stores constrains ROCE in the short term, but increases operating
profit and drives future growth. The division continued to
implement its proven strategy and the performance of the business
against these criteria is set out below: Strategy: To achieve
sector leading performance standards In 2007/08 the division
increased total sales by 4.1% (52 week basis, see note 11), and,
despite the comparative weakness of the middle mass market,
performed broadly in line with the total US jewellery market which
grew by 4.0% to $64.7 billion in calendar 2007 (2006: $62.2
billion; source: US Department of Commerce). The Group's share of
the speciality jewellery market remained at 8.8%. In 1997/98, the
division accounted for 4.8% of speciality jewellery sales and 7.0%
in 2002/03. Over the five year period ended on 2 February 2008 the
division's operating margin averaged 12.0% and Earnings Before
Interest and Tax ("EBIT") / Year End Total Assets ratio was 14.9%.
Jewelers of America reported that the typical speciality retail
jeweller was achieving an average operating margin of 5.4% and a
7.7% EBIT / Year End Total Assets ratio over the five years to 31
December 2006, being the last year for which figures have been
published. While 2007/08 was difficult, over the last five years
the Group's total sales have increased by 56.4% and operating
profit by 25.8%. Strategy: To improve store productivity The key
driver of the division's comparatively high operating margins and
return on assets is store productivity, which is well above that of
the industry as a whole. While the Group's strategy is to increase
store productivity, there was a decline in 2007/08, reflecting the
fall in like for like sales and an increase in the proportion of
immature stores under six years old. Over the last five years the
sales per store for Kay and Jared have increased to $1.71 million
from $1.53 million and to $5.34 million from $4.57 million
respectively. The regional brands achieved sales per store of $1.34
million in 2007/08 with the difference in performance between Kay
and the regional brands continuing to reflect the benefit of
national television advertising. Strategy: To grow new store space
The Group has strict criteria for investment which have been
consistently applied. Over the last five years net new store space
of 10% per annum has required a total investment of some $700
million in fixed and working capital. Appraisal reviews show that,
in aggregate, investment returns continue to exceed the Group's
targeted 20% internal rate of return over five years. In 2007/08,
net new store space grew by 10% (2006/07: 11%). Over 80% of the
growth was outside traditional malls in 2007/08 and at 2 February
2008 about 40% of store space was off-mall. The table below sets
out the store numbers, net new openings and the potential number of
stores by chain and format: 3 Net 2 Expected Long Store February
openings February net openings term numbers 2007 2007/08 2008
2008/09 Potential Kay Mall 772 17 789 6 850+ Off-mall 52 40 92 19
500+ Outlet 5 5 10 8 50-100 Metropolitan 3 nil 3 nil c.30 832 62
894 33 1,430+ Regionals 341 10 351 (14) c.700 Jared 135 19 154 17
c.300 Total 1,308 91 1,399 36 2,430+ Real estate investment In
2007/08, fixed capital investment was $111.1 million (2006/07:
$101.1 million), including some $60.1 million (2006/07: $57.3
million) related to new store space. In 2008/09, revisions to sales
projections reflecting the challenging trading conditions, will
result in fewer opportunities that meet the Group's investment
criteria. Therefore, in 2008/09, space growth is expected to be
about 5%, net of about 30 store closures (2007/08: 17). Over the
longer term the US division continues to have the potential to
almost double its size. This can be achieved through organic
expansion within the existing formats for Kay and Jared. For the
regional brands to achieve this potential would require one or more
acquisitions, and such activity is not expected to occur
imminently. Recent and planned investment in the store portfolio,
both fixed and working capital, is set out below: Planned 2008/09
2007/08 2006/07 2005/06 $m $m $m $m Total new stores Fixed capital
investment 45 60 57 45 Working capital investment 90 119 119 96
Total investment 135 179 176 141 Other store fixed capital
investment 24 28 30 28 Total store investment 159 207 206 169 Fixed
capital expenditure in 2008/09 is planned to decrease to about $90
million, including circa $45 million related to new stores. The
investment in working capital, that is inventory and receivables,
associated with gross space growth amounted to some $119 million in
2007/08 and is expected to be significantly lower at about $90
million in 2008/09. 62 stores were refurbished or relocated
(2006/07: 59), with some 51 planned for 2008/09. Operating
initiatives in 2008/09 In the current challenging environment the
US business has taken action to control costs tightly. Store staff
hours and advertising expenditure have been realigned, where
possible, to reflect current sales expectations. Staff training and
development continues to be a priority, as does investment to
enhance in-store procedures to improve customer service and
productivity. Staffing levels elsewhere have been frozen, despite
the growth in store numbers, and a range of other costs have been
cut. Consumers' financial positions continue to deteriorate which
may lead to a further increase in the bad debt charge, although
this is expected to be somewhat offset by increased income from the
credit portfolio. Consequently credit authorisation criteria
continue to be reviewed and outstanding balances are very closely
monitored with prompt action being taken in response to changes in
performance. In addition, further investment in collection systems
is taking place. The development of exclusive ranges, such as the
Leo Diamond, the Peerless Diamond and the Hearts Desire collection
and the expansion of the Le Vian selection, continue to help
differentiate the division in the marketplace and to increase
average transaction value. The 2007/08 year end inventory was above
plan by about $20 million due to the difficult fourth quarter and
future purchases are being strictly controlled. Actions to realign
inventory to current sales levels have been taken and it is
anticipated that this will be achieved by June 2008. In 2006/07 and
2007/08 substantial increases in gold and platinum costs had an
impact on the entire US jewellery sector, and were largely not
passed on to consumers. After careful consideration and planning it
was decided to increase prices covering a broad merchandise range,
including both basic and fashion products, following Valentine's
Day 2008. The Group's pricing strategy is to be competitive over
the long term; however the price changes have resulted in a
departure from this position in the short term, although an
increasing number of speciality jewellers are also increasing
prices. While the impact of the price increases will only be fully
apparent in the second quarter of 2008/09, the early results are
encouraging. Advertising expenditure as a percentage of sales is
being realigned to nearer historic levels, in addition the cadence
of promotional activity is being increased and made more responsive
to market conditions. The Kay website will be further developed and
an e-commerce facility on the Jared website is planned to be
introduced in the second half of 2008/09. UK performance review
(26% of Group sales) Change at Like constant for like exchange
change rates on a on a 2007/08 2006/07 Change 52 week 52 week 52
weeks 53 weeks reported basis(1) basis $m $m % % % Sales: H.Samuel
513.4 490.3 4.7 (0.1) 1.3 Ernest Jones 438.8 409.1 7.3 2.3 2.9
Other 7.4 7.7 (3.9) (7.5) Total(2) 959.6 907.1 5.8 0.9 2.0
Operating profit 105.1 103.4 1.6 (1.3) Operating margin(2) 11.0%
11.4% ROCE 29.9% 32.7% (1) See note 11 for reconciliation of impact
of exchange rates and adjustment for 53rd week in 2006/07. (2) See
Group financial review for tables analysing total sales growth and
movement in operating margin. In a tough UK retail marketplace like
for like sales were ahead of last year and operating margins, cash
flow and ROCE remained strong. The business achieved further
improvements in the key areas of execution, particularly customer
service. Like for like sales growth was 2.0%, an encouraging
performance in an increasingly challenging marketplace. Growth in
the first nine months of 2007/08 was stronger than last year at
4.7%, but became more difficult in the fourth quarter with like for
like sales declining by 1.7%. Total sales increased by 0.9% at
constant exchange rates on a 52 week basis (see note 11) and by
5.8% on a reported basis to $959.6 million (2006/07: $907.1
million). Operating profit was little changed at constant exchange
rates on a 52 week basis (see note 11); the reported increase was
1.6% to $105.1 million (2006/07: $103.4 million). Operating margin
was down 40 basis points on the prior year reflecting expense
leverage of 40 basis points from the small increase in like for
like sales combined with tight control of costs, an adverse
movement in gross margin percentage of 60 basis points and the
benefit to 2006/07 of the 53rd week (adverse 20 basis points). The
movement in gross margin was primarily caused by changes in mix due
to the strong performance of the watch category, some impact from
commodity costs and an increased proportion of sales from Ernest
Jones. ROCE was 29.9% (2006/07: 32.7%), primarily reflecting the
impact of the 53rd week in 2006/07 and a slight increase in capital
employed. Further progress was made in implementing the division's
successful strategy and its performance against those criteria are
set out below: Strategy: To achieve sector leading performance
standards The total UK jewellery market was unchanged at 4.5
billion Pounds in calendar 2007 including VAT (source: Office of
National Statistics); and the division's market share was similar
to last year at 12.1%. In 2007/08, the division's operating margin
was 11.0% and its EBIT / Year End Total Assets ratio was 21.2%. In
the year to 31 March 2007, the last year for which figures are
available, the next five largest speciality retail jewellers had an
average operating margin of 5.7% and a 6.4% EBIT / Year End Total
Assets ratio. Strategy: To improve store productivity Store
productivity increased in both H.Samuel and Ernest Jones in 2007/08
to 0.72 million Pounds from 0.70 million Pounds and to 1.11 million
Pounds from 1.08 million Pounds respectively. This reflected
divisional like for like sales growth of 2.0% and, in H.Samuel, a
continuing reduction of the store base to focus on stores in larger
centres that provide an opportunity to achieve a greater ROCE. With
average selling space of about 870 square feet per store, Ernest
Jones achieved the highest sales density of any Signet brand. Real
estate and investment During 2007/08, 27 stores were refurbished or
relocated. At the year end, 282 locations, mostly H.Samuel, traded
in the customer oriented format, accounting for some 50% of the UK
division's sales. At 2 February 2008, there were 359 H.Samuel and
204 Ernest Jones branches (3 February 2007: 375 and 206
respectively). 2007/08 2006/07 2005/06 H.Samuel stores Openings 1 -
3 Closures (17) (11) (15) Year end 359 375 386 Ernest Jones stores
Openings - 1 5 Closures (2) (2) (2) Year end 204 206 207 Total
stores at year end 563 581 593 The level of store capital
expenditure during 2007/08 was 9 million pounds (2006/07: 8 million
pounds) reflecting the phasing of the refurbishment cycle. In
2008/09 it is planned to roll out up to 49 sites, including new
locations, in the enhanced Ernest Jones store design, which
produced very encouraging results when tested in the second half of
2007/08. In addition, up to a further 25 H.Samuel locations are
expected to begin trading in the more customer oriented format by
Christmas 2008. As a result store capital expenditure is expected
to increase to some 25 million Pounds in 2008/09. Recent and
planned investment in the portfolio is set out below: Planned
2008/09 2007/08 2006/07 2005/06 Store refurbishments and
relocations 69 27 28 78 New H.Samuel stores 2 1 - 3 New Ernest
Jones stores 3 - 1 5 Store fixed capital investment 25m pounds 9m
pounds 8m pounds 22m pounds Operating initiatives for 2008/09 In
the current uncertain environment, the UK business will continue to
manage costs, inventory and gross margin very closely. While the
impact of commodity cost increases has been less than in the US due
to the weakness of the dollar, price increases have been
implemented. The successful initiative to drive footfall by taking
advantage of the scale of the business, while maintaining gross
margin, through key volume lines will continue to be developed. The
diamond selection, particularly in exclusive and value ranges, is
being enhanced. Mixed metal ranges are being expanded and new
merchandise is being tested more efficiently. In the watch
category, relationships with the leading agencies continue to be a
priority. Additional initiatives continue to be introduced to raise
customer service standards even further, including extension of the
customer satisfaction index to all sites and enhancements to
training materials on product knowledge and selling skills. New
store communication and executional tools are being tested.
Advertising expenditure will be adjusted to reflect the return on
investment being achieved. The "H.Samuel helps you say it better"
and "Only at Ernest Jones" marketing propositions are planned to be
developed further and the e-commerce websites for both brands are
expected to be improved. Group financial review Dollar reporting
Following the approval of shareholders and the High Court, the
redenomination of the Company's share capital became effective on 5
February 2007. The Company's functional currency is now US dollars
and the Group reports in US dollars. Sales growth, operating margin
and ROCE The components of the 3.0% increase in Group total sales
in 2007/08 are analysed in the table below: Components of sales
growth US UK Group % % % Like for like sales on a 52 week basis
(1.7) 2.0 (0.7) Change in net store space 5.8 (1.1) 3.9 Exchange
translation - 6.5 1.7 Total sales growth on a 52 week basis 4.1 7.4
4.9 Impact of 53rd week in 2006/07 (2.1) (1.6) (1.9) Total sales
growth as reported 2.0 5.8 3.0 Group operating margin (operating
profit to sales ratio) was 9.6% in 2007/08 (2006/07: 11.7%), the
factors causing this movement are analysed below: Components of
operating margin movement US UK Group % % % 2006/07 operating
margin 12.3 11.4 11.7 Impact of 53rd week in 2006/07 0.2 (0.2) 0.1
2006/07 operating margin on 52 week basis 12.5 11.2 11.8 Gross
margin (0.3) (0.6) (0.4) Expense leverage (1.9) 0.4 (1.4) New store
space (0.6) - (0.4) 2007/08 operating margin 9.7 11.0 9.6 ROCE was
16.8% (2006/07: 22.8%). Capital employed is based on the average of
the monthly balance sheets and at 2 February 2008 included US net
receivables, nearly all of which are in-house credit card debtors,
amounting to $840.2 million (3 February 2007: $778.9 million).
Group and financing costs Group central costs amounted to $16.0
million (2006/07: $13.9 million), reflecting the impact of exchange
translation movements and higher professional fees. Net financing
costs amounted to $17.8 million (2006/07: $15.4 million), the
increase being primarily due to the share buy back programme
commenced in 2006/07 and completed in the first quarter of 2007/08.
Taxation The charge of $118.3 million (2006/07: $134.8 million)
represents an effective tax rate of 35.5% (2006/07: 33.6%). The
rate was lower than indicated in the third quarter due to the
change in mix of profit between the US and UK businesses and a more
favourable resolution of certain prior year tax positions. It is
anticipated that, subject to the outcome of various uncertain tax
positions, the Group's effective tax rate in 2008/09 will be at a
similar level to the reported rate in 2007/08. Profit for the
financial period Profit for the 52 weeks ended 2 February 2007 was
$215.2 million (53 weeks to 3 February 2007: $266.0 million).
Purchase of own shares During 2007/08 the Group completed a share
buy back programme with 12.2 million shares (2006/07: 30.3 million)
purchased for $29.0 million (2006/07: $63.4 million). Liquidity and
capital resources Operating cash flow before working capital
movements was $465.7 million (2006/07: $519.9 million). Total
investment in new space, both fixed and working capital, during the
year was $178.9 million (2006/07: $176.7 million). The total
investment in working capital was $171.0 million (2006/07: $173.5
million), of which $118.8 million (2006/07: $119.4 million) related
to net new space. While inventory levels were generally tightly
controlled, there was an increase of $96.8 million (2006/07: $118.1
million) primarily reflecting space growth in the US. The majority
of the increase in receivables of $60.7 million (2006/07: $101.5
million) was due to space growth and a fall in monthly collection
rate. There was a decrease in payables of $13.5 million (2006/07:
increase $46.1 million) as the Group took advantage of discounts
from suppliers for early payment. Cash generated from operations
amounted to $294.7 million (2006/07: $346.4 million). Interest of
$29.8 million (2006/07: $31.4 million) and tax of $128.5 million
(2006/07: $130.1 million) were paid. Net cash flows from operating
activities were $136.4 million (2006/07: $184.9 million). Group
capital expenditure was $140.4 million (2006/07: $124.4 million).
The level of capital expenditure was some 1.2 times (2006/07: 1.3
times) the depreciation and amortisation charge of $114.1 million
(2006/07: $98.4 million). Equity dividends of $123.9 million
(2006/07: $108.7 million) were paid in the year and the net
movement in shares outstanding was an outflow of $23.0 million
(2006/07: outflow $55.7 million) reflecting the completion of the
share buy back programme commenced in 2006/07. There was an
increase in net debt before exchange rate adjustments of $143.6
million (2006/07: $86.4 million). Net debt at 2 February 2008 was
$374.6 million (3 February 2007: $233.2 million) and gearing was
20.7% (3 February 2007: 13.4%). It is anticipated that in 2008/09
there will be a further increase in the level of working capital as
a result of planned net US store openings and the expansion of the
rough diamond sourcing initiative, however this is expected to be
significantly less than in 2007/08. Capital expenditure is forecast
to be at a similar level to 2007/08 as lower expenditure in the US
is balanced by an increase in the UK. Tax payments will be less
reflecting the level of profits reported in 2007/08. In total, a
cash outflow of between $40 million and $80 million is anticipated
in 2008/09 before exchange adjustments and changes in equity and
subject to general economic uncertainties. Pensions The Group has
one defined benefit plan (the "Group Scheme") for UK-based staff,
which was closed to new members in 2004. All other pension
arrangements consist of defined contribution plans. The IAS 19
present value of obligations of the Group Scheme decreased last
year by $4.2 million to $253.7 million and the market value of the
Group Scheme's assets fell by $13.5 million to $248.1 million; as a
result the balance sheet at 2 February 2008 reflected a net pension
liability of $4.0 million (3 February 2007: net pension asset of
$2.5 million). The cash contribution to the fund in 2007/08 was
$7.2 million (2006/07: $6.8 million) and the Group expects to
contribute a similar amount in 2007/08. Summary of fourth quarter
results (unaudited) 13 weeks 13 weeks 14 weeks comparable ended
ended period like 2 February 3 February for like 2008 2007 change
$m $m % Sales UK 384.2 397.6 (1.7) US 1,000.6 1,077.6 (8.6) 1,384.8
1,475.2 (6.7) Operating profit UK - Trading 105.5 111.6 - Group
central costs (3.0) (3.6) 102.5 108.0 US 124.4 182.5 Total
operating profit 226.9 290.5 Net financing costs (4.9) (3.3) Profit
before tax 222.0 287.2 Taxation (77.6) (94.4) Profit for the period
144.4 192.8 EPS - basic 8.4c 11.2c - diluted 8.4c 11.1c The Board
of Directors approved this statement of annual results on 9 April
2008. Investor relations programme details There will be an
analysts' presentation and conference call today at 2.00 p.m. BST
(9.00 a.m. EDT and 6.00 a.m. Pacific Time) and a simultaneous audio
and video webcast at http://www.signetgroupplc.com/. To help ensure
the conference call begins in a timely manner, could all
participants please dial in 5 to 10 minutes prior to the scheduled
start time. The call details are: European dial-in: +44 (0) 20 7806
1963 US dial-in: +1 718 354 1391 European 48hr. replay: +44 (0) 20
7806 1970 Access code: 9456483# US 48hr. replay: +1 718 354 1112
Access code: 9456483# First quarter sales First quarter sales
figures are expected to be announced on 8 May 2008. This release
includes 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 as well as on
assumptions made by and data currently available to management,
appear in a number of places throughout this release and include
statements regarding, among other things, our results of operation,
financial condition, liquidity, prospects, growth, strategies and
the industry in which the Group operates. Our use of the words
"expects," "intends," "anticipates," "estimates," "may,"
"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,
including but not limited to general economic conditions, the
merchandising, pricing and inventory policies followed by the
Group, the reputation of the Group, the level of competition in the
jewellery sector, the price and availability of diamonds, gold and
other precious metals, seasonality of the Group's business and
financial market risk. For a discussion of these and other risks
and uncertainties which could cause actual results to differ
materially, see the "Risk and Other Factors" section of the
Company's 2006/07 Annual Report on Form 20-F filed with the U.S.
Securities and Exchange Commission on May 4, 2007 and other filings
made by the Company with the Commission. Actual results may differ
materially from those anticipated in such forward-looking
statements even if experience or future changes make it clear that
any projected results expressed or implied therein may not be
realised. The Company undertakes no obligation to update or revise
any forward-looking statements to reflect subsequent events or
circumstances. SIGNET GROUP plc Consolidated income statement for
the 52 weeks ended 2 February 2008 52 weeks 53 weeks ended ended 2
February 3 February 2008 2007(1) Notes $m $m Sales 3,665.3 3,559.2
2,11 Cost of sales (3,264.8) (3,092.4) Gross profit 400.5 466.8
Administrative expenses (158.0) (142.1) Other operating income
108.8 91.5 3 Operating profit 351.3 416.2 2,11 Finance income 11.0
18.8 4 Finance expense (28.8) (34.2) 4 Profit before tax 333.5
400.8 11 Taxation (118.3) (134.8) 5 Profit for the financial period
215.2 266.0 11 Earnings per share - basic 12.6c 15.4c 7,11 -
diluted 12.6c 15.3c 7 Earnings per ADS - basic 126.3c 154.0c 7 -
diluted 126.1c 153.4c 7 (1) Comparative period figures have been
restated following a change in presentational currency from UK
pounds to US dollars with effect from 5 February 2007. All of the
above relate to continuing activities attributable to equity
holders of the Company. Consolidated balance sheet as at 2 February
2008 2 February 3 February 2008 2007(1) Notes $m $m Assets:
Non-current assets Intangible assets 52.6 46.3 Property, plant and
equipment 502.4 484.8 Other receivables 34.8 29.2 Retirement
benefit asset - 3.7 Deferred tax assets 19.7 29.0 609.5 593.0
Current assets Inventories 1,445.5 1,350.6 Trade and other
receivables 927.5 869.1 Cash and cash equivalents 41.7 152.3
2,414.7 2,372.0 Total assets 3,024.2 2,965.0 Liabilities: Current
liabilities Borrowings due in less than one year (36.3) (5.5) Trade
and other payables (357.5) (392.4) Deferred income (125.3) (122.7)
Current tax (79.5) (101.7) (598.6) (622.3) Non-current liabilities
Borrowings due in more than one year (380.0) (380.0) Other payables
(85.3) (74.7) Deferred income (139.0) (132.0) Provisions (9.6)
(10.0) Retirement benefit obligation (5.6) - (619.5) (596.7) Total
liabilities (1,218.1) (1,219.0) Net assets 1,806.1 1,746.0 Equity:
Capital and reserves attributable to equity holders of the Company
Share capital 15.4 14.0 Share premium 140.2 134.7 9 Other reserves
235.2 235.1 9 Retained earnings 1,415.3 1,362.2 9 Total equity
1,806.1 1,746.0 (1) Comparative period figures have been restated
following a change in presentational currency from UK pounds to US
dollars with effect from 5 February 2007. Consolidated cash flow
statement for the 52 weeks ended 2 February 2008 52 weeks 53 weeks
ended ended 2 February 3 February 2008 2007(1) $m $m Cash flows
from operating activities: Profit before tax 333.5 400.8
Adjustments for: Finance income (11.0) (18.8) Finance expense 28.8
34.2 Depreciation of property, plant and equipment 109.4 96.0
Amortisation of intangible assets 4.7 2.4 Share-based payment
expense 0.4 6.7 Other non-cash movements (1.5) (2.2) Loss on
disposal of property, plant and equipment 1.4 0.8 Operating cash
flows before movements in working capital 465.7 519.9 Increase in
inventories (96.8) (118.1) Increase in receivables (60.7) (101.5)
(Decrease)/increase in payables (13.5) 46.1 Cash generated from
operations 294.7 346.4 Interest paid (29.8) (31.4) Taxation paid
(128.5) (130.1) Net cash flows from operating activities 136.4
184.9 Investing activities: Interest received 6.3 16.9 Purchase of
property, plant and equipment (129.1) (116.9) Purchase of
intangible assets (11.3) (7.5) Proceeds from sale of property,
plant and equipment 1.0 0.6 Net cash flows from investing
activities (133.1) (106.9) Financing activities: Dividends paid
(123.9) (108.7) Proceeds from issue of shares 6.0 7.7 Purchase of
own shares (29.0) (63.4) Increase in short-term borrowings 31.1 7.0
Repayment of long-term borrowings - (251.0) Receipt of long-term
borrowings - 380.0 Net cash flows from financing activities (115.8)
(28.4) Cash and cash equivalents at beginning of period 152.3 92.9
(Decrease)/increase in cash and cash equivalents (112.5) 49.6
Exchange adjustments 1.9 9.8 Cash and cash equivalents at end of
period 41.7 152.3 Reconciliation of net cash flow to movement in
net debt Net debt at beginning of period (233.2) (174.5)
(Decrease)/increase in cash and cash equivalents (112.5) 49.6
Increase in borrowings (31.1) (136.0) Exchange adjustments 2.2 27.7
Net debt at end of period (374.6) (233.2) Net debt represents cash
and cash equivalents and borrowings. (1) Comparative period figures
have been restated following a change in presentational currency
from UK pounds to US dollars with effect from 5 February 2007.
Consolidated statement of recognised income and expense for the 52
weeks ended 2 February 2008 52 weeks 53 weeks ended ended 2
February 3 February 2008 2007(1) $m $m Exchange differences on
translation of foreign operations (0.1) 57.3 Effective portion of
fair value movements on cash flow hedges 14.1 1.7 Transfer to
initial carrying value of inventory from cash flow hedges (10.2)
1.5 Actuarial (loss)/gain on retirement benefit obligation (15.0)
30.5 Deferred tax on items recognised in equity 3.7 (10.3) Net
(expense)/income recognised directly in equity (7.5) 80.7 Profit
for the financial period 215.2 266.0 Total recognised income &
expense attributable to equity holders of the Company 207.7 346.7
(1) Comparative period figures have been restated following a
change in presentational currency from UK pounds to US dollars with
effect from 5 February 2007. Notes to the financial results for the
52 weeks ended 2 February 2008 1. Basis of preparation This
financial information has been prepared in accordance with
International Financial Reporting Standards as adopted by the
European Union ("IFRS"). This financial information has been
prepared on the basis of the accounting policies set out in the
Annual Report & Accounts for the 53 weeks ended 3 February 2007
which are available on the Group's website
http://www.signetgroupplc.com/. Whilst the financial information
included in this preliminary announcement has been prepared in
accordance with IFRS, this announcement does not itself contain
sufficient information to comply with IFRS. These results are
presented in US dollars following a change in the Group's
presentational currency from UK pounds to US dollars with effect
from 5 February 2007. In addition, on 5 February 2007 the Company
redenominated its share capital into US dollars and will maintain
distributable reserves and declare dividends in US dollars.
Financial information for prior periods has been restated from UK
pounds to the new presentational currency, US dollars, in
accordance with IAS 21. 2. Segmental information 2008 2007 $m $m
Sales by origin and destination UK, Channel Islands & Republic
of Ireland 959.6 907.1 US 2,705.7 2,652.1 3,665.3 3,559.2 Operating
profit UK, Channel Islands & Republic of Ireland - Trading
105.1 103.4 - Group function (16.0) (13.9) 89.1 89.5 US 262.2 326.7
351.3 416.2 The Group's results derive from one business segment --
the retailing of jewellery, watches and associated services. The
Group is managed as two geographical operating segments: the US and
UK divisions. Both divisions are managed by executive committees,
which report through the Group Chief Executive to the Group Board.
Each divisional executive committee is responsible for operating
decisions within guidelines set by the Group Board. 3. Other
operating income Other operating income comprises interest
receivable from the US in-house credit programme of $108.4 million
(2007: $93.3 million) and foreign exchange gains of $0.4 million
(2007: $1.8 million losses). 4. Finance income and expense 2008
2007 $m $m Interest income 6.2 16.7 Defined benefit pension scheme
- expected return on scheme assets 18.3 14.7 - interest on pension
liabilities (13.5) (12.6) Finance income 11.0 18.8 Finance expense
(28.8) (34.2) Net finance charge (17.8) (15.4) 5. Taxation 2008
2007 $m $m Current taxation - UK 42.0 30.7 - US 67.5 105.8 Deferred
taxation - UK (2.2) (2.8) - US 11.0 1.1 118.3 134.8 6. Translation
differences The exchange rates used for the translation of UK pound
transactions and balances in these accounts are as follows: 2008
2007 Income statement (average rate) 2.00 1.88 Balance sheet
(period end rate) 1.97 1.97 7. Earnings per share 2008 2007
Earnings attributable to shareholders ($m) 215.2 266.0 Basic
weighted average number of shares in issue (million) 1,703.8
1,727.6 Dilutive effect of share options (million) 3.3 6.8 Diluted
weighted average number of shares in issue (million) 1,707.1
1,734.4 Earnings per share - basic 12.6c 15.4c - diluted 12.6c
15.3c Earnings per ADS - basic 126.3c 154.0c - diluted 126.1c
153.4c The number of ordinary shares in issue at 2 February 2008
was 1,705,560,466 (3 February 2007: 1,713,553,809). 8. Dividends
2008 2007 $m $m Final dividend paid of 6.317c per share (2007:
2.8875p) 107.6 94.2 Interim dividend paid of 0.96c per share (2007:
0.4434p) 16.3 14.5 123.9 108.7 During 2007/08, a dividend of 6.317
cents per share was paid on 6 July 2007 in respect of the final
dividend declared for the 53 week period ended 3 February 2007. An
interim dividend of 0.96 cents for the 52 week period ended 2
February 2008 was also paid on 9 November 2007. The 2006/07 interim
dividend was translated at the exchange rate on 3 November 2006.
Subject to shareholder approval, a proposed final dividend of 6.317
cents per share will be paid on 3 July 2008 to those shareholders
on the register of members at close of business on 23 May 2008.
This financial information does not reflect this proposed dividend,
which will be treated as an appropriation of retained earnings in
the 52 week period ending 31 January 2009. For shareholders who
wish to receive the proposed final dividend in pounds sterling, the
actual amount will be calculated using the exchange rate as derived
from Reuters at 4.00 p.m. on the record date of 23 May 2008. Under
US tax legislation the rate of US federal income tax on dividends
received by individual US shareholders from qualified foreign
corporations are subject to US federal income tax at a reduced rate
of 15%. Dividends paid by the Group to individual US holders of
shares or ADSs should qualify for this preferential dividend
treatment. This US tax legislation only applies to individuals
subject to US federal income taxes and therefore the tax position
of UK shareholders is unaffected. Individual US holders of shares
and ADSs are urged to consult their tax advisers regarding the
application of this US tax legislation to their particular
circumstances. 9. Share premium and reserves Other reserves Share
Capital Special premium redemption reserves $m $m $m At 28 January
2006 124.8 - 234.8 Recognised income and expense: - profit for the
financial period - - - - cash flow hedges (net) - - - - translation
differences - - - - actuarial gain (net) - - - Dividends - - -
Equity-settled transactions (net) - - - Share options exercised 8.6
- - Purchase of own shares - 0.3 - Shares issued to ESOTs 1.3 - -
At 3 February 2007 134.7 0.3 234.8 Exchange arising on
redenomination of share capital (1.4) - - 133.3 0.3 234.8
Recognised income and expense: - profit for the financial period -
- - - cash flow hedges (net) - - - - translation differences - - -
- actuarial loss (net) - - - Dividends - - - Equity-settled
transactions (net) - - - Share options exercised 6.5 - - Purchase
of own shares - 0.1 - Shares issued to ESOTs 0.4 - - At 2 February
2008 140.2 0.4 234.8 Retained earnings Purchase of Hedging
Translation Retained Total own shares reserve reserve reserve(1) $m
$m $m $m $m At 28 January 2006 (15.4) 2.8 (47.2) 1,241.5 1,541.3
Recognised income and expense: - - profit for the financial period
- - - 266.0 266.0 - - cash flow hedges (net) - 2.3 - - 2.3 - -
translation differences - - 57.3 - 57.3 - - actuarial gain (net) -
- - 21.1 21.1 Dividends - - - (108.7) (108.7) Equity-settled
transactions (net) - - - 8.1 8.1 Share options exercised 2.1 - -
(3.0) 7.7 Purchase of own shares - - - (63.4) (63.1) Shares issued
to ESOTs - - - (1.3) - At 3 February 2007 (13.3) 5.1 10.1 1,360.3
1,732.0 Exchange arising on redenomination of share capital - - - -
(1.4) (13.3) 5.1 10.1 1,360.3 1,730.6 Recognised income and
expense: - - profit for the financial period - - - 215.2 215.2 - -
cash flow hedges (net) - 3.1 - - 3.1 - - translation differences -
- (0.1) - (0.1) - - actuarial loss (net) - - - (10.5) (10.5)
Dividends - - - (123.9) (123.9) Equity-settled transactions (net) -
- - (0.3) (0.3) Share options exercised 2.5 - - (3.5) 5.5 Purchase
of own shares - - - (29.0) (28.9) Shares issued to ESOTs - - -
(0.4) - At 2 February 2008 (10.8) 8.2 10.0 1,407.9 1,790.7 (1) The
retained reserve includes the unrealised surplus arising from
revaluing freehold and long leasehold properties of $8.5 million (3
February 2007: $8.5 million). 10. Accounts The financial
information set out above does not constitute the Company's
statutory accounts for the 52 weeks ended 2 February 2008 or the 53
weeks ended 3 February 2007, but is derived from those accounts.
Statutory accounts for the 53 weeks ended 3 February 2007 have been
delivered to the Registrar of Companies, whereas those for the 52
weeks ended 2 February 2008 will be delivered following the
Company's annual general meeting. The auditors have reported under
Section 235 of the Companies Act 1985 on those accounts for each of
those periods; their reports were unqualified and did not contain a
statement under Section 237 (2) or (3) of that Act. 11. Impact of
constant exchange rates and 53rd week The Group has historically
used constant exchange rates to compare period- to-period changes
in certain financial data. This is referred to as 'at constant
exchange rates' throughout this release. The Group considers this a
useful measure for analysing and explaining changes and trends in
the Group's results. The impact of the re-calculation of sales,
operating profit, profit before tax, profit for the financial
period and earnings per share at constant exchange rates and the
impact of the 53rd week in 2006/07, including a reconciliation to
the Group's GAAP results, is analysed below. 2007/08 2006/07 Growth
Impact 2006/07 at of 53rd on 52 week actual week basis at exchange
actual rates exchange rates (non-GAAP) $m $m % $m $m Sales by
origin and destination: UK 959.6 907.1 5.8 (13.2) 893.9 US 2,705.7
2,652.1 2.0 (52.2) 2,599.9 3,665.3 3,559.2 3.0 (65.4) 3,493.8
Operating profit: UK -Trading 105.1 103.4 1.6 (3.3) 100.1 -Group
function (16.0) (13.9) n/a - (13.9) 89.1 89.5 (0.4) (3.3) 86.2 US
262.2 326.7 (19.7) (0.5) 326.2 351.3 416.2 (15.6) (3.8) 412.4
Profit before tax 333.5 400.8 (16.8) (3.2) 397.6 Profit for the
financial period 215.2 266.0 (19.1) (2.1) 263.9 Earnings per share
12.6c 15.4c (18.2) (0.1)c 15.3c 2007/08 Impact of 2006/07 2007/08
52 week exchange on 52 week 52 week growth at rate basis growth at
actual movement at constant constant exchange exchange exchange
rates rates rates (non-GAAP) (non-GAAP) (non-GAAP) % $m $m % Sales
by origin and destination: 7.4 57.0 950.9 0.9 UK 4.1 - 2,599.9 4.1
US 4.9 57.0 3,550.8 3.2 Operating profit: UK -Trading 5.0 6.4 106.5
(1.3) - Group function n/a (0.9) (14.8) n/a 3.4 5.5 91.7 (2.8) US
(19.6) - 326.2 (19.6) (14.8) 5.5 417.9 (15.9) Profit before tax
(16.1) 6.1 403.7 (17.4) Profit for the financial period (18.4) 4.3
268.2 (19.7) Earnings per share (17.5) 0.2c 15.5c (18.7) 12.
Reconciliation of IFRS to US GAAP Effect on profit for the
financial period of differences between IFRS and US GAAP 52 weeks
53 weeks ended ended 2 February 3 February 2008 2007 $m $m Profit
for the financial period in accordance with IFRS 215.2 266.0 Sale
and leaseback transactions 1.5 1.5 Pensions (2.8) (4.5) Share-based
payment 3.8 (4.5) Depreciation of revalued properties 0.2 -
Taxation on reconciling items 1.9 0.2 US GAAP adjustments before
change in accounting principle 4.6 (7.3) Cumulative effect of
change in accounting principle - (6.0) Profit attributable to
equity holders of the Company in accordance with US GAAP 219.8
252.7 Earnings per share in accordance with US GAAP - basic 12.9c
14.6c - diluted 12.8c 14.3c Weighted average number of shares
outstanding (million) - basic 1,703.8 1,727.6 - diluted 1,721.4
1,765.1 Effect on funds attributable to equity holders of the
Company of differences between IFRS and US GAAP 2008 2007 $m $m
Funds attributable to equity holders of the Company in accordance
with IFRS 1,806.1 1,746.0 Goodwill in respect of acquisitions
(gross) 876.1 876.1 Accumulated goodwill amortisation (350.7)
(350.7) Sale and leaseback transactions (10.7) (12.2) Pensions - -
Depreciation of properties (4.7) (4.9) Revaluation of properties
(8.5) (8.5) Share-based payment (1.5) (21.3) Derivatives 8.1 -
Taxation on reconciling items 7.0 3.4 US GAAP adjustments 515.1
481.9 Funds attributable to equity holders of the Company in
accordance with US GAAP 2,321.2 2,227.9 Reconciliation of funds
attributable to equity holders of the Company in accordance with US
GAAP Funds attributable to equity holders of the Company at
beginning of period 2,227.9 2,062.9 Adoption of SFAS 123(R) - (5.3)
2,227.9 2,057.6 Retained profit attributable to equity holders of
the Company 219.8 252.7 (Purchase)/issue of shares (net) (23.5)
(55.7) Increase in additional paid-in capital 18.5 2.3 Dividends
paid (123.9) (108.7) Other comprehensive income 2.6 39.3
Translation differences (0.2) 71.9 2,321.2 2,259.4 Adoption of SFAS
158 - (31.5) Funds attributable to equity holders of the Company at
end of period 2,321.2 2,227.9 DATASOURCE: Signet Group plc CONTACT:
Terry Burman, Group Chief Executive, +44(0)20-7317-9700; or Walker
Boyd, Group Finance Director, +44(0)20-7317-9700, both of Signet
Group plc; or Jonathan Glass, Brunswick, +44(0)20-7404-5959; or
Wendel Verbeek, Brunswick, +44(0)20-7404-5959, both for Signet
Group plc Web site: http://www.signetgroupplc.com/
Copyright