Signet Returns to Profit

UK sales were weak for Signet

Specialty jeweler Signet reported a 1.6 percent decrease in annual sales to $3.29 billion as well as a 0.4 percent drop in same store sales. The company posted a pre-tax profit of $241.8 million in the fiscal year ending January 31, compared to a $326.5 million loss in the previous year.

The annual results were buoyed by strong fourth quarter performance. Same store sales increased 5.2 percent, pushing up total sales to $1.2 billion. This is a 7.1 percent year-over-year increase, a 4.7 percent increase at constant exchange rates.

Signet saw same store sales increase in the U.S., while they decreased in the UK.

Sales in the U.S., which represented 78 percent of sales in 2009, rose 6.8 percent to $920.8 million in the fourth quarter. Average unit price point decreased 19.6 percent to $270. Average price points at Jared, Signet’s higher-end brand in the U.S., declined 3.3 percent to $660.

Annual U.S. sales rose marginally to $2.56 billion.

Sales by the UK division totaled $282.8 million in the quarter, up 8.1 percent on a reported basis, but down 1.6 percent at constant exchange rates. The average selling price rose 3.9 percent to £75 ($112). Annual UK sales declined to $733.2 million.

According to Signet Chief Executive Terry Burman, the company’s “strategy remains especially appropriate in the current uncertain economic environment.

“Solid execution of this strategy should help us achieve a further profitable market share increase, which would build on our ten year record that has seen our US market share almost double to 9.4 percent in fiscal 2010,” Burman added.

Signet reportedly started the fiscal year on a high note, with same store sales in the first seven weeks rising 7.8 percent in the U.S. In the UK, however, same store sales decreased 0.1 percent during the period.