Strong U.S. Sales Offset U.K. losses for Signet

Strong U.S. sales helped overcome a loss on its British operations for Signet, the world's largest specialty jewelry retailer, in its first half results. Signet posted a 2.4 million pound ($4.4 million) operating loss in the U.K. in the six months to the end of July. In the U.K. its 596 shops trade under the H. Samuel and Ernest Jones names.

UK sales dropped 7.8 percent but total group sales rose 5.6 percent to 722.9 million pounds ($1.32 billion)

But strong sales in the United States, which accounts for 70 percent of sales, helped group pre-tax profit rise to 52.1 million pounds ($95.2 million) from 50 million pounds a year ago.

Profit in the second quarter was unchanged at 24.4 million pounds ($44.6 million) versus a 7 percent rise in the first quarter from a year earlier.

As with many other British retailers, Signet has seen sales fall due to rises in interest rates last year, a softening in the housing market and increased uncertainty over the state of the economy.

U.S. consumer spending, on the other hand, has been strong in spite of rising energy prices, with luxury chains outperforming discount retailers that cater for low-income shoppers.

Signet said its U.S. business significantly outperformed its main rivals and increased its share of the specialty jewelry market to 7.2 percent compared to 5 percent five years ago.

Its Jared chain of mall stores, around 10 percent of its 1,079 U.S. outlets, did particularly well, Signet said.

The firm said it plans to test consumers response to a television marketing campaign to launch a second nationwide mall brand, and if successful it could re-brand existing stores and expand the reach of its TV advertisements.

"We've got the opportunity to open hundreds of additional mall stores under that second national brand," said group CEO Terry Burman.