Delivers strong revenue growth and expands
non-GAAP operating margin
Reaffirms full year guidance on confidence in
sustainable and agile operating structure
$318 million of
share repurchases completed in Q1 and authorization expanded by
$500 million
HAMILTON, Bermuda, June 9, 2022
/PRNewswire/ -- Signet Jewelers Limited ("Signet") (NYSE:SIG), the
world's largest retailer of diamond jewelry, today announced its
results for the 13 weeks ended April 30, 2022 ("first quarter
Fiscal 2023").
"Signet's strong performance this quarter reflects our team's
successful execution and agility amidst retail headwinds," said
Virginia C. Drosos, Chief Executive
Officer. "We generated nearly 9% topline growth, including 2.6%
organic sales growth, enabled by our healthy inventory position,
connected commerce capabilities and data-driven marketing.
Customers responded to the breadth and newness within our
assortment, particularly higher price point offerings, diamonds and
precious metals. Our scale, strong balance sheet, and diversified
banner portfolio provide flexibility to navigate macro level
uncertainties, deliver consistent annual double-digit operating
margin, and continue investing in differentiated capabilities to
widen our competitive advantages."
"We are reaffirming our annual guidance and expanding our share
repurchase authorization by $500
million," said Joan Hilson,
Chief Financial and Strategy Officer. "While we anticipated and
experienced softening within lower price points resulting from
heightened inflation and the lack of stimulus, we delivered offsets
through tailored assortments, digital capabilities and enhanced
services to maintain higher average transaction values. At this
time, we continue to focus on the factors under our control and
leverage our competitive advantages as we navigate the impact of
this macro-economic environment on consumer behavior. We believe
that the strategies, agility and discipline of our team will enable
us to continue to drive long-term value for our shareholders."
First Quarter Fiscal 2023 Highlights:
- Total sales were $1.8 billion, up
$149.5 million or 8.9% to Q1 of
FY22.
- Same store sales ("SSS") up 2.5% (1) to Q1 of
FY22.
- GAAP operating income of $0.2
million, down from $168.7
million in Q1 of FY22, including the impact of charges
related to the resolution of previously disclosed litigation.
- Non-GAAP operating income(2) of $194.6 million, up from $168.9 million in Q1 of FY22.
- GAAP diluted loss per share of $1.89, down from a diluted earnings per share
("EPS") of $2.23 in Q1 of FY22,
including $2.92 in charges related to
the resolution of previously disclosed litigation, $2.19 in non-cash charges related to the buy-out
of substantially all of the UK pension plan obligations and
$0.07 in charges relating to the fair
value adjustment of acquired inventory.
- Non-GAAP diluted EPS(2) of $2.86, up from $2.23 in Q1 of FY22.
- Cash and cash equivalents, at quarter end, of $927.6 million.
- Cash used for operating activities of $135.5 million, down approximately $297 million to Q1 of FY22 and driven by
inventory in-stock replenishment.
- Completed $318.2 million of share
repurchases during Q1, including $50
million related to completion of the previously announced
accelerated share repurchase ("ASR") agreement.
(1)
|
Same store sales
include physical stores and eCommerce sales. Diamonds Direct is
excluded.
|
(2)
|
See non-GAAP
reconciliation page.
|
|
|
Fiscal 23 Q1
|
|
Fiscal 22 Q1
|
Sales ($ in
millions)
|
|
$ 1,838.3
|
|
$ 1,688.8
|
SSS % change
(1)
|
|
2.5 %
|
|
106.5 %
|
GAAP
|
|
|
|
|
Operating
income
|
|
$
0.2
|
|
$
168.7
|
Operating income as %
of sales
|
|
— %
|
|
10.0 %
|
GAAP Diluted EPS (loss
per share)
|
|
$ (1.89)
|
|
$ 2.23
|
Non-GAAP (2)
|
|
|
|
|
Non-GAAP operating
income
|
|
$
194.6
|
|
$
168.9
|
Non-GAAP operating
income as % of sales
|
|
10.6 %
|
|
10.0 %
|
Non-GAAP Diluted
EPS
|
|
$ 2.86
|
|
$ 2.23
|
(1)
|
Same store sales
include physical stores and eCommerce sales. Diamonds Direct is
excluded.
|
(2)
|
See non-GAAP
reconciliation page.
|
First Quarter Fiscal 2023 Results:
|
Change
from previous year
|
|
|
First Quarter Fiscal 2023
|
Same
store
sales
|
|
Non-same
store sales,
net
|
|
Total sales
at constant
exchange rate
|
|
Exchange
translation
impact
|
|
Total
sales
as reported
|
|
Total
sales
(in millions)
|
North America
segment
|
(0.9) %
|
|
6.3 %
|
|
5.4 %
|
|
— %
|
|
5.4 %
|
|
$
1,705.0
|
International
segment
|
102.6 %
|
|
(0.8) %
|
|
101.8 %
|
|
(10.2) %
|
|
91.6 %
|
|
$ 110.0
|
Other segment
(1)
|
nm
|
|
nm
|
|
nm
|
|
nm
|
|
nm
|
|
$ 23.3
|
Signet
|
2.5
%
|
|
6.6
%
|
|
9.1
%
|
|
(0.2)
%
|
|
8.9
%
|
|
$
1,838.3
|
(1)
|
Includes sales from
Signet's diamond sourcing initiative.
|
nm
|
Not
meaningful.
|
By reportable segment:
North America
- Total sales of $1.7 billion, up
5.4% to Q1 of FY22.
- SSS declined 0.9% to Q1 of FY22 reflecting higher average
transaction value ("ATV") and a lower number of transactions.
International
- Total sales of $110.0 million, up
91.6% to Q1 of FY22.
- SSS grew 102.6% versus Q1 of FY22 reflecting prior year store
operating restrictions, higher ATV and a higher number of
transactions.
GAAP gross margin was $723.7
million, or 39.4% of sales, down 80 basis points to the
first quarter last year. This primarily reflects similar
merchandise margin to last year within organic banners and the
strength of Diamonds Direct's bridal business which carries a lower
relative margin. It also reflects the absence of COVID-related tax
abatement within Signet's U.K. operations.
SG&A was $533.1 million, or
29.0% of sales, an improvement of 130 basis points to the first
quarter last year. This improvement reflects the impact of the
enhanced credit agreements finalized in the second quarter of
Fiscal 2022, as well as the efficiency of Diamonds Direct's
operating model, partially offset by labor investments implemented
in the back half of last year.
GAAP operating income was $0.2
million or 0.0% of sales, compared to $168.7 million, or 10.0% of sales in the prior
year first quarter.
Non-GAAP operating income was $194.6
million, or 10.6% of sales, compared to $168.9 million, or 10.0% of sales in prior year
first quarter. Non-GAAP operating income excluded $190.0 million in charges related to the
resolution of previously disclosed litigation and $4.4 million in charges relating to the fair
value adjustment of acquired inventory.
|
|
First quarter Fiscal 2023
|
|
First quarter Fiscal 2022
|
GAAP Operating income in
millions
|
|
$
|
|
% of sales
|
|
$
|
|
% of sales
|
North America
segment
|
|
$
24.8
|
|
1.5 %
|
|
$
212.0
|
|
13.1 %
|
International
segment
|
|
(6.4)
|
|
(5.8) %
|
|
(19.7)
|
|
(34.3) %
|
Other
segment
|
|
3.0
|
|
nm
|
|
(0.9)
|
|
nm
|
Corporate and
unallocated expenses
|
|
(21.2)
|
|
nm
|
|
(22.7)
|
|
nm
|
Total GAAP operating
income
|
|
$
0.2
|
|
— %
|
|
$
168.7
|
|
10.0 %
|
|
|
|
|
|
|
|
First quarter Fiscal 2023
|
|
First quarter Fiscal 2022
|
Non-GAAP Operating income in millions
(1)
|
|
$
|
|
% of sales
|
|
$
|
|
% of sales
|
North America
segment
|
|
$
219.2
|
|
12.9 %
|
|
$
212.2
|
|
13.1 %
|
International
segment
|
|
(6.4)
|
|
(5.8) %
|
|
(19.7)
|
|
(34.3) %
|
Other
segment
|
|
3.0
|
|
nm
|
|
(0.9)
|
|
nm
|
Corporate and
unallocated expenses
|
|
(21.2)
|
|
nm
|
|
(22.7)
|
|
nm
|
Total Non-GAAP
operating income
|
|
$
194.6
|
|
10.6 %
|
|
$
168.9
|
|
10.0 %
|
(1)
|
See non-GAAP
reconciliation page.
|
nm
|
Not
meaningful
|
The current quarter GAAP income tax benefit was $55.2 million compared to an income tax expense
of $26.5 million in the prior year
first quarter. On a non-GAAP basis, income tax expense was
$18.6 million compared to income tax
expense of $26.6 million in the prior
year first quarter.
GAAP diluted loss per share was $1.89, including $2.92 in charges related to the resolution of
previously disclosed litigation, $2.19 in non-cash charges related to the buy-out
of substantially all of the U.K. pension obligations and
$0.07 in charges relating to the fair
value adjustment of acquired inventory. Excluding these charges
(and related tax effects), diluted EPS was $2.86 on a non-GAAP basis.
GAAP EPS excludes the anti-dilutive impact of the preferred
shares in the share count based on the net loss recorded in the
first quarter of Fiscal 2023. Non-GAAP diluted EPS in the current
quarter includes the dilutive impact of the preferred shares in the
share count based on the level of non-GAAP net income this
quarter.
Balance Sheet and Statement of Cash Flows Highlights:
Cash used for operating activities of $135.5 million in Q1 Fiscal 2023 compared to
cash provided by operating activities of $161.1 million in the first quarter last year.
Cash and cash equivalents were $927.6
million as of quarter end, compared to $1.3 billion last year. The year over year change
to cash and equivalents was primarily driven by share repurchases
and inventory in-stock replenishment, as well as the acquisition of
Diamonds Direct in the prior year.
Ending inventory was $2.2 billion,
up approximately $200 million to the
first quarter last year as a result of the Company's acquisition of
Diamonds Direct in November 2021.
Return of Capital:
Signet's Board of Directors has declared a quarterly cash
dividend on common shares from $0.20
per share for the second quarter of Fiscal 2023, payable
August 26, 2022 to shareholders of
record on July 29, 2022, with an
ex-dividend date of July 28,
2022.
As of April 30, 2022 Signet
repurchased approximately 4.3 million shares at an average cost per
share of $73.42 or $318.2 million, including $50 million of repurchases related to the
Company's completion of its previously announced ASR.
Approximately $645 million remains
under the Company's newly expanded authorization.
Our Purpose and Sustainable Growth:
As a company with a Purpose-inspired business strategy, Signet
is committed to ongoing leadership in Corporate Citizenship &
Sustainability and views Environmental, Social and Governance
("ESG") initiatives as an important growth driver. Signet released
its Fiscal 2022 Corporate Citizenship & Sustainability Report
with a progress report on its 2030 Corporate Sustainability Goals.
The report reflects the Company's commitment to its Corporate
Sustainability framework defined by Love for All People; Love for
our Team; and Love for our Planet and Products. Since the release
of its Corporate Sustainability Goals, approximately one year ago,
the Company has successfully integrated the Inspiring Brilliance
business strategy and long-term corporate sustainability
initiatives into its culture and day to day business
operations.
Fiscal 2023 Guidance:
Signet is reaffirming its Fiscal 2023 annual outlook which is
provided on a non-GAAP basis.
|
Second
Quarter
|
|
Fiscal
2023
|
Total revenue (in
billions)
|
$1.79 to
$1.82
|
|
$8.03 to
$8.25
|
Operating income
(1) (in millions)
|
$188 to $204
|
|
$921 to $974
|
Diluted EPS
(1)(2)
|
|
|
$12.72 to
$13.47
|
(1)
|
See description
of non-GAAP measures below
|
(2)
|
EPS range reflects
updated assumptions and share repurchases completed in the first
quarter
|
Forecasted non-GAAP operating income provided above excludes
potential non-recurring charges. However, given the potential
impact of non-recurring charges to the GAAP operating income, 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.
The Company's second quarter and Fiscal 2023 Outlook is based on
the following assumptions:
- The Company's outlook includes a level of consumer pressure,
including inflation and the impact of stimulus, similar to what is
currently being experienced. The Company's outlook does not
include a material worsening of macroeconomic factors which could
impact consumer spending patterns and have associated impacts on
business performance.
- Signet continues to anticipate some shift of consumer
discretionary spending away from the jewelry category reflecting
decelerating levels of consumer confidence and pent-up demand for
experience-oriented categories during the year.
- Signet's efforts to mitigate supply chain disruption have been
effective thus far. Guidance assumes no significant disruptions in
availability of inventory.
- Annual effective tax rate of approximately 19% assumes no
additional discrete items and no changes in current tax laws during
the remainder of Fiscal 2023.
- The above guidance excludes non-recurring charges for Fiscal
2023 related to the resolution of previously disclosed legal matter
of $190 million, approximately
$11 million relating to the fair
value adjustment of acquired inventory that will be recognized
within cost of sales in Fiscal 2023, and the non-operating non-cash
charges for the buy-out of substantially all of the UK pension
obligations of approximately $132
million.
- Earnings per share excludes any further share repurchases.
- Planned capital investments up to $250
million, reflecting continued investments in Connected
Commerce capabilities, banner differentiation and technology
harmonization.
Conference Call:
A conference call is scheduled for June 9, 2022 at
8:30 a.m. ET and a simultaneous audio
webcast is available at www.signetjewelers.com. The call details
are:
Toll Free US Dial-in: 1-844-200-6205
Toll Free Canada Dial-in: 1-833-950-0062
International Dial-In: +1 929-526-1599
Access Code: 305452
Conference call participants may also pre-register at:
https://www.incommglobalevents.com/registration/q4inc/10951/signet-jewelers-first-quarter-fiscal-2022-earnings-call/
A replay and transcript of the call will be posted on Signet's
website as soon as they are available and will be accessible for
one year.
About Signet and Safe Harbor Statement:
Signet Jewelers Limited is the world's largest retailer of
diamond jewelry. As a purpose-driven and sustainability-focused
company, Signet is a participant in the United Nations Global
Compact and adheres to its principles-based approach to responsible
business. Signet is a Great Place to Work –Certified™ company and
has been named to the Bloomberg Gender-Equality Index for four
consecutive years. Signet operates approximately 2,800 stores
primarily under the name brands of Kay Jewelers, Zales, Jared,
Banter by Piercing Pagoda, Diamonds Direct, JamesAllen.com,
Peoples, H. Samuel, Ernest Jones and
the jewelry subscription service, Rocksbox. Further
information on Signet is available at www.signetjewelers.com. See
also www.kay.com, www.zales.com, www.jared.com, www.banter.com,
www.diamondsdirect.com, www.jamesallen.com,
www.peoplesjewellers.com, www.hsamuel.co.uk, www.ernestjones.co.uk
and www.rocksbox.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, results of operations, 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 could have in the future,
on Signet's business, financial condition, profitability and cash
flows; the effect of steps we take in response to the pandemic; the
severity, duration and potential resurgence of the pandemic
(including through variants), 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, our ability to attract and retain labor
especially if COVID-19 vaccine mandates are implemented, consumer
behaviors such as willingness to congregate in shopping centers and
shifts in spending away from the jewelry category toward more
experiential purchases, the impacts of the expiration of government
stimulus on overall consumer spending, 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, including impacts of inflation or
other pricing environment factors on the Company's commodity costs
(including diamonds) or other operating costs; a prolonged slowdown
in the growth of the jewelry market or the overall economy;
financial market risks; a decline in consumer discretionary
spending or deterioration in consumer financial position, including
the impacts of inflation and rising prices on necessities such as
gas and groceries; our ability to optimize Signet's transformation
strategies; 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, including due to technology disruptions, future
financial results and operating results and/or disruptions arising
from changes to or termination of the relevant outsourcing
agreements; 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, planned share repurchases
(including execution of accelerated share repurchases) 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; future legislative and regulatory requirements in the US
and globally relating to climate change, including any new climate
related disclosure or compliance requirements, such as those
recently proposed by the SEC; 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, including any impact on the global
market supply of diamonds due to the ongoing Russia-Ukraine conflict or related sanctions;
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; our ability to optimize
Signet's multi-year strategy to gain market share, expand and
improve existing services, innovate and achieve sustainable,
long-term growth; the maintenance and continued innovation of
Signet's OmniChannel retailing and ability to increase digital
sales, as well as management of its digital marketing costs;
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
team members - particularly in regions experiencing low
unemployment rates; 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 new information technology systems which impact
financial reporting; 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 corporate taxation rates, 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 or
deductions associated with payments to foreign related parties that
are subject to a low effective tax rate; risks related to
international laws and Signet being a Bermuda corporation; difficulty or delay in
executing or integrating an acquisition, including Diamonds Direct,
or executing other major business or strategic initiatives; 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; or the impact of
weather-related incidents, natural disasters, organized crime or
theft, strikes, protests, riots or terrorism, acts of war
(including the ongoing Russian-Ukraine conflict), 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 2022
Annual Report on Form 10-K filed with the SEC on March 17,
2022 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
+1-330-665-6530
vincent.sinisi@signetjewelers.com
Media:
Colleen
Rooney
Chief Communications & ESG Officer
+1-330-668-5932
colleen.rooney@signetjewelers.com
GAAP to Non-GAAP Reconciliations
The following information provides reconciliations of the most
directly comparable financial measures calculated and presented in
accordance with accounting principles generally accepted in the
U.S. ("GAAP") to presented non-GAAP financial measures. The Company
believes that non-GAAP financial measures, when reviewed in
conjunction with GAAP financial measures, can provide more
information to assist investors 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 useful supplementary information to management and
investors in assessing the operating performance of our
business.
These non-GAAP financial measures should be considered in
addition to, and not superior to or as a substitute for the GAAP
financial measures presented in this earnings release and the
Company's condensed consolidated financial statements and other
publicly filed reports. In addition, our non-GAAP financial
measures may not be the same as or comparable to similar non-GAAP
measures presented by other companies.
In discussing financial results, the Company refers to free cash
flow that is not in accordance with GAAP and is defined as the net
cash (used in) provided by operating activities, less purchases of
property, plant, and equipment. Free cash flow does not
represent the residual cash flow available for discretionary
purposes.
|
|
13 weeks
ended
|
(in millions)
|
|
April 30,
2022
|
|
May 1,
2021
|
Net cash (used in)
provided by operating activities
|
|
$
(135.5)
|
|
$
161.1
|
Purchase of property,
plant and equipment
|
|
(20.8)
|
|
(11.3)
|
Free cash
flow
|
|
(156.3)
|
|
149.8
|
|
|
|
13 weeks ended
|
(in millions)
|
|
April 30, 2022
|
|
May 1, 2021
|
Gross margin
|
|
$
723.7
|
|
$
678.4
|
Inventory step up -
cost of sales
|
|
4.4
|
|
—
|
Non-GAAP Gross
Margin
|
|
$
728.1
|
|
$
678.4
|
|
|
|
13 weeks ended
|
(in millions)
|
|
April 30, 2022
|
|
May 1, 2021
|
Total GAAP operating
income
|
|
$
0.2
|
|
$
168.7
|
Charges related to
transformation plan
|
|
—
|
|
(0.7)
|
Asset impairments, net
(1)
|
|
—
|
|
(0.2)
|
Acquisition-related
costs (2)
|
|
4.4
|
|
1.1
|
Litigation
charges
|
|
190.0
|
|
—
|
Total non-GAAP
operating income
|
|
$
194.6
|
|
$
168.9
|
(1) Includes
asset impairments, net recorded due to the various impacts of
COVID-19 to the Company's business and related gains on
terminations or
modifications of leases, resulting from previously recorded
impairments of the right of use assets in Fiscal 2021.
|
|
(2) Acquisition-related costs include
the impact of the fair value step up for inventory from Diamonds
Direct, as well as includes professional fees for direct
transaction-related costs incurred for the acquisitions of Rocksbox
in the first quarter of Fiscal 2022.
|
|
|
|
13 weeks ended
|
(in millions)
|
|
April 30, 2022
|
|
May 1, 2021
|
North America segment
GAAP operating income
|
|
$
24.8
|
|
$
212.0
|
Charges related to
transformation plan
|
|
—
|
|
(0.7)
|
Asset impairments, net
(1)
|
|
—
|
|
(0.2)
|
Litigation
charges
|
|
190.0
|
|
—
|
Acquisition-related
costs (2)
|
|
4.4
|
|
1.1
|
North America segment
non-GAAP operating income
|
|
$
219.2
|
|
$
212.2
|
(1)
Includes asset impairments, net recorded due to the various impacts
of COVID-19 to the Company's business and related gains on
terminations or
modifications of leases, resulting from previously recorded
impairments of the right of use assets in Fiscal 2021.
|
|
(2) Acquisition-related costs include
the impact of the fair value step up for inventory from Diamonds
Direct, as well as includes professional fees for direct
transaction-related costs incurred for the acquisitions of Rocksbox
in the first quarter of Fiscal 2022.
|
|
13 weeks ended
|
(in
millions)
|
April 30, 2022
|
|
May 1, 2021
|
GAAP income tax expense
(benefit)
|
$
(55.2)
|
|
$
26.5
|
Charges related to
transformation plan
|
—
|
|
0.2
|
Pension settlement
loss
|
25.0
|
|
—
|
Acquisition-related
costs (1)
|
1.1
|
|
(0.1)
|
Litigation
charges
|
47.7
|
|
—
|
Non-GAAP income tax
expense
|
$
18.6
|
|
$
26.6
|
(1) Acquisition-related costs include
the impact of the fair value step up for inventory from Diamonds
Direct, as well as includes professional fees for direct
transaction-related costs incurred for the acquisitions of Rocksbox
in the first quarter of Fiscal 2022.
|
|
|
13 weeks ended
|
|
April 30, 2022
|
|
May 1, 2021
|
GAAP effective tax
rate
|
39.8
%
|
|
16.1
%
|
Charges related to
transformation plan
|
— %
|
|
0.1
%
|
Pension settlement
loss
|
(10.1)
%
|
|
— %
|
Acquisition-related
costs (1)
|
(0.4)
%
|
|
(0.1) %
|
Litigation
charges
|
(19.4)
%
|
|
— %
|
Non-GAAP effective tax
rate
|
9.9
%
|
|
16.1
%
|
(1) Acquisition-related costs include
the impact of the fair value step up for inventory from Diamonds
Direct, as well as includes professional fees for direct
transaction-related costs incurred for the acquisitions of Rocksbox
in the first quarter of Fiscal 2022.
|
|
|
|
13 weeks ended
|
|
|
April 30, 2022
|
|
May 1, 2021
|
GAAP Diluted
EPS
|
|
$
(1.89)
|
|
$
2.23
|
Charges related to
transformation plan
|
|
—
|
|
(0.01)
|
Pension settlement
loss
|
|
2.70
|
|
—
|
Litigation
charges
|
|
3.89
|
|
—
|
Acquisition-related
costs (1)
|
|
0.09
|
|
0.02
|
Dilution effect
(2)
|
|
(0.43)
|
|
—
|
Tax impact of items
above
|
|
(1.50)
|
|
(0.01)
|
Non-GAAP Diluted
EPS
|
|
$
2.86
|
|
$
2.23
|
(1) Acquisition-related costs include
the impact of the fair value step up for inventory from Diamonds
Direct, as well as includes professional fees for direct
transaction-related costs incurred for the acquisitions of Rocksbox
in the first quarter of Fiscal 2022.
|
|
(2) First
quarter of Fiscal 2023 includes 59.2 diluted weighted average
common shares outstanding. The additional dilutive shares were
excluded from the
calculation of GAAP dilutive EPS, as their effect was
antidilutive.
|
Condensed
Consolidated Statements of Operations (Unaudited)
|
|
|
|
13 weeks ended
|
(in millions, except
per share amounts)
|
|
April 30, 2022
|
|
May 1, 2021
|
Sales
|
|
$
1,838.3
|
|
$
1,688.8
|
Cost of
sales
|
|
(1,114.6)
|
|
(1,010.4)
|
Gross margin
|
|
723.7
|
|
678.4
|
Selling, general and
administrative expenses
|
|
(533.1)
|
|
(512.0)
|
Other operating income
(expense)
|
|
(190.4)
|
|
2.3
|
Operating income
|
|
0.2
|
|
168.7
|
Interest expense,
net
|
|
(4.4)
|
|
(3.9)
|
Other non-operating
income (expense)
|
|
(134.5)
|
|
0.1
|
Income (loss) before income taxes
|
|
(138.7)
|
|
164.9
|
Income taxes
|
|
55.2
|
|
(26.5)
|
Net
income (loss)
|
|
$
(83.5)
|
|
$
138.4
|
Dividends on redeemable
convertible preferred shares
|
|
(8.6)
|
|
(8.6)
|
Net
income (loss) attributable to common shareholders
|
|
$
(92.1)
|
|
$
129.8
|
|
|
|
|
|
Earnings (loss) per
common share:
|
|
|
|
|
Basic
|
|
$
(1.89)
|
|
$
2.49
|
Diluted
|
|
$
(1.89)
|
|
$
2.23
|
Weighted average common
shares outstanding:
|
|
|
|
|
Basic
|
|
48.8
|
|
52.1
|
Diluted
|
|
48.8
|
|
62.0
|
|
|
|
|
|
Dividends declared per
common share
|
|
$
0.20
|
|
$
—
|
Condensed
Consolidated Balance Sheets (Unaudited)
|
|
(in millions, except
par value per share amount)
|
|
April 30,
2022
|
|
January 29,
2022
|
|
May 1,
2021
|
Assets
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
927.6
|
|
$ 1,418.3
|
|
$ 1,298.4
|
Accounts receivable, net
|
|
17.1
|
|
19.9
|
|
78.9
|
Other current assets
|
|
209.9
|
|
208.6
|
|
187.1
|
Income taxes
|
|
144.7
|
|
23.2
|
|
58.4
|
Inventories
|
|
2,216.2
|
|
2,060.4
|
|
2,019.0
|
Total current
assets
|
|
3,515.5
|
|
3,730.4
|
|
3,641.8
|
Non-current
assets:
|
|
|
|
|
|
|
Property, plant and
equipment, net
|
|
561.1
|
|
575.9
|
|
544.5
|
Operating lease
right-of-use assets
|
|
1,141.8
|
|
1,206.6
|
|
1,301.2
|
Goodwill
|
|
486.4
|
|
484.6
|
|
244.9
|
Intangible assets,
net
|
|
313.5
|
|
314.2
|
|
190.6
|
Other assets
|
|
232.4
|
|
226.1
|
|
241.0
|
Deferred tax
assets
|
|
35.6
|
|
37.3
|
|
16.8
|
Total assets
|
|
$
6,286.3
|
|
$ 6,575.1
|
|
$ 6,180.8
|
Liabilities,
Redeemable convertible preferred shares, and
Shareholders' equity
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
Accounts payable
|
|
$
880.7
|
|
$
899.8
|
|
$
700.1
|
Accrued expenses and other current liabilities
|
|
610.6
|
|
501.6
|
|
517.2
|
Deferred revenue
|
|
336.9
|
|
341.3
|
|
310.0
|
Operating lease liabilities
|
|
287.2
|
|
300.0
|
|
345.7
|
Income taxes
|
|
24.4
|
|
28.0
|
|
24.5
|
Total current
liabilities
|
|
2,139.8
|
|
2,070.7
|
|
1,897.5
|
Non-current
liabilities:
|
|
|
|
|
|
|
Long-term
debt
|
|
147.1
|
|
147.1
|
|
146.8
|
Operating lease
liabilities
|
|
948.1
|
|
1,005.1
|
|
1,087.3
|
Other
liabilities
|
|
103.7
|
|
117.6
|
|
108.9
|
Deferred
revenue
|
|
867.1
|
|
857.6
|
|
797.7
|
Deferred tax
liabilities
|
|
171.1
|
|
160.9
|
|
171.1
|
Total
liabilities
|
|
4,376.9
|
|
4,359.0
|
|
4,209.3
|
Commitments and
contingencies
|
|
|
|
|
|
|
Series A redeemable
convertible preferred shares
|
|
652.6
|
|
652.1
|
|
650.9
|
Shareholders'
equity:
|
|
|
|
|
|
|
Common shares
|
|
12.6
|
|
12.6
|
|
12.6
|
Additional paid-in capital
|
|
236.8
|
|
231.2
|
|
252.2
|
Other reserves
|
|
0.4
|
|
0.4
|
|
0.4
|
Treasury shares, at
cost
|
|
(1,474.2)
|
|
(1,206.7)
|
|
(965.2)
|
Retained earnings
|
|
2,740.9
|
|
2,877.4
|
|
2,304.2
|
Accumulated other comprehensive loss
|
|
(259.7)
|
|
(350.9)
|
|
(283.6)
|
Total shareholders'
equity
|
|
1,256.8
|
|
1,564.0
|
|
1,320.6
|
Total liabilities,
redeemable convertible preferred shares and shareholders'
equity
|
|
$
6,286.3
|
|
$ 6,575.1
|
|
$ 6,180.8
|
Condensed
Consolidated Statements of Cash Flows (Unaudited)
|
|
|
|
13 weeks
ended
|
(in
millions)
|
|
April 30,
2022
|
|
May 1,
2021
|
Cash flows from
operating activities
|
|
|
|
|
Net income
(loss)
|
|
$
(83.5)
|
|
$
138.4
|
Adjustments to
reconcile net income (loss) to net cash (used in) provided by
operating activities:
|
|
|
|
|
Depreciation and amortization
|
|
40.0
|
|
42.1
|
Amortization of unfavorable contracts
|
|
(0.5)
|
|
(1.4)
|
Share-based compensation
|
|
10.5
|
|
8.0
|
Deferred taxation
|
|
(14.9)
|
|
9.5
|
Pension settlement loss
|
|
131.9
|
|
—
|
Other non-cash movements
|
|
5.1
|
|
2.0
|
Changes in operating assets and liabilities, net of
acquisitions:
|
|
|
|
|
Decrease in accounts
receivable
|
|
2.8
|
|
9.8
|
(Increase) decrease in other
assets and other receivables
|
|
(7.3)
|
|
44.0
|
(Increase) decrease in
inventories
|
|
(167.3)
|
|
19.3
|
Decrease in accounts
payable
|
|
(23.6)
|
|
(122.2)
|
Increase in accrued expenses
and other liabilities
|
|
105.1
|
|
18.0
|
Change in operating lease
assets and liabilities
|
|
(4.4)
|
|
(31.2)
|
Increase in deferred
revenue
|
|
5.4
|
|
34.4
|
Change in income tax receivable
and payable
|
|
(125.6)
|
|
(8.4)
|
Pension plan
contributions
|
|
(9.2)
|
|
(1.2)
|
Net cash (used in)
provided by operating activities
|
|
(135.5)
|
|
161.1
|
Investing
activities
|
|
|
|
|
Purchase of property, plant and equipment
|
|
(20.8)
|
|
(11.3)
|
Purchase of available-for-sale securities
|
|
—
|
|
(1.0)
|
Proceeds from sale of available-for-sale
securities
|
|
0.5
|
|
1.9
|
Acquisitions, net of cash acquired
|
|
(1.9)
|
|
(14.4)
|
Net cash used in
investing activities
|
|
(22.2)
|
|
(24.8)
|
Financing
activities
|
|
|
|
|
Dividends paid on common shares
|
|
(9.0)
|
|
—
|
Dividends paid on redeemable convertible preferred
shares
|
|
(8.2)
|
|
—
|
Repurchase of common shares
|
|
(268.2)
|
|
—
|
Other financing activities
|
|
(40.2)
|
|
(13.7)
|
Net cash used in
financing activities
|
|
(325.6)
|
|
(13.7)
|
Cash and cash
equivalents at beginning of period
|
|
1,418.3
|
|
1,172.5
|
(Decrease) increase in
cash and cash equivalents
|
|
(483.3)
|
|
122.6
|
Effect of exchange rate
changes on cash and cash equivalents
|
|
(7.4)
|
|
3.3
|
Cash and cash
equivalents at end of period
|
|
$
927.6
|
|
$ 1,298.4
|
Real Estate Portfolio:
Signet has a diversified real estate portfolio. On
April 30, 2022, Signet had 2,854 stores totaling 4.2 million
square feet of selling space. Compared to year-end Fiscal 2022,
store count net stayed flat and square feet of selling space
increased 0.4%.
Store count by segment
|
January 29, 2022
|
|
Openings
|
|
Closures
|
|
April 30, 2022
|
North America
segment
|
2,506
|
|
14
|
|
(13)
|
|
2,507
|
International
segment
|
348
|
|
1
|
|
(2)
|
|
347
|
Signet
|
2,854
|
|
15
|
|
(15)
|
|
2,854
|
View original
content:https://www.prnewswire.com/news-releases/signet-jewelers-reports-first-quarter-fiscal-2023-results-301564545.html
SOURCE Signet Jewelers Ltd.