Signet Group sales for its first quarter rose 1.4 percent year on year to $900 million in the period that ended on April 28, 2012. The rate of increase for Signet's cost of sales rose slightly more at 1.7 percent and totaled $546.3 million, and gross margin as a percentage of sales was basically flat at 39.3 percent. Same-store sales for the quarter rose 1.2 percent. Despite weak sales performance, especially given the high rate of jewelry inflation in the U.S. this year, Signet did report a strong increase in profits, up 9.3 percent to $82.5 million.
Signet's U.S. division sales rose 1.8 percent year on year to $751.5 million, while comparable-store sales rose 1.2 percent. In the U.K., sales rose 1.4 percent at a constant exchange-rate and same-store sales increased 1.2 percent. The net impact of a stronger dollar, however, reduced U.K. sales 0.5 percent.
The retailer's cash and equivalents were $399 million on April 28, compared with $394.1 million one year ago. Net inventory rose 9.3 percent year on year to $1.34 billion. The increased level of inventory reflected the U.S. promotional calendar shift related to Mother’s Day, which fell after the quarter closed, and the impact of higher diamond and gold costs, partially offset by management action to improve inventory turn, according to the group.
Mike Barnes, Signet's chief executive, said, “We delivered strong financial results in the first quarter and increased our earnings per share by 10.3 percent to 96 cents as we anticipated the impact of the Mother’s Day promotional calendar shift and managed our business accordingly. I would like to thank all at Signet who contributed to these results.''
Barnes added that same-store sales so far in the second quarter were up by ''strong double-digits'' and that the retailer was ''well positioned to meet the challenges of the current economic environment and achieve our objectives for the year.''