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Signet Holiday Sales Disappoint
Jan 10, 2018 12:54 PM
By Rapaport News
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RAPAPORT... Signet Jewelers’ holiday sales fell 3% as issues relating to outsourcing its credit transactions adversely impacted the business.
Signet in October sold its prime credit program to Alliance Data Systems for $960 million, meaning that credit purchases were now outsourced to the third party rather than extended by Signet. However, disruptions in the system, primarily at its Kay Jewelers stores, put a dent in the important holiday period.
Signet’s total sales came to $1.88 billion, while same-store sales declined 5.3% for the nine-week period that ended December 30.
“During the holiday season, we made positive progress on our strategic priorities, offset primarily by the negative impact of the credit-outsourcing transition, as evident [from] the mixed performance across our banners and channels,” said Signet CEO Virginia Drosos.
Sales at the Sterling Jewelers division, which consists of Kay and Jared, slid 4.5% to $1.15 billion, and same-store sales dropped 8.5%. Its UK division also disappointed, with sales down 4% to $177.1 million and same-store sales slumping 10.3%.
Signet’s strongest performer was its Zale division, where sales rose 1% to $556.2 million, and same-store sales increased 4%, thanks to a strong performance in bridal and fashion jewelry, the company noted. Its e-commerce business jumped 48% to $210.5 million, driven by the addition of James Allen, which the company acquired earlier in the year.
The disappointing results followed a string of positive reports about the holiday season, with Mastercard SpendingPulse reporting a 5.9% rise in overall jewelry sales across the US during the two-month period.
Signet shares slumped 7% in Wednesday-morning trading on the New York Stock Exchange.
Image: Tooykrub/Shutterstock
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Tags:
credit, holiday season, holidays, Rapaport News, retail, Signet, Signet Jewelers
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