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Signet to Shut 200 Stores After Sales Disappoint

Mar 14, 2018 11:26 AM   By Rapaport News
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RAPAPORT... Signet Jewelers has unveiled a three-year plan for returning the company to growth, after sales slid last year.

The retailer, whose brands include Kay Jewelers, Zales and Jared, aims to close more than 200 stores by February 2019 and upgrade its e-commerce business in a bid to reverse its recent disappointing financial performance. It also plans to reduce costs and improve value for customers, it said in a statement Wednesday.

The jeweler’s same-store sales — at branches open for a year — dropped 5% both for the fourth quarter ending February 3 and for the full fiscal year, mainly due to issues with the company’s outsourcing of its credit services. Total sales dropped 2.4% to $6.25 billion at all stores for the full year, and increased 1% to $2.29 billion for the fourth quarter, the retailer said. Profit for the year dropped 4% to $519.3 million. Signet’s share price slumped 17% during morning trading Wednesday.

“Fiscal 2018 was a challenging year for Signet,” said CEO Virginia Drosos. “We gained sales momentum in our Zales banner in the fourth quarter as our strategic initiatives began to take hold, but we experienced challenges at our Kay and Jared banners, including execution issues related to the first phase of our credit-outsourcing transaction.”

As part of the transformation, Signet has appointed Sharon McCollam and Nancy Reardon as independent board directors. McCollam is the former executive vice president, chief administration officer and chief financial officer of Best Buy. Reardon was previously chief human resources and communications officer at Campbell Soup Company.

The plan is the most recent initiative in Signet’s efforts to improve performance. In January, Signet changed its reporting structure, creating one line of communication for each team within a store brand, all of which report to president and chief customer officer Seb Hobbs.

Image: Helen89/Shutterstock
Tags: Best Buy, Campbell Soup Company, George Murray, Jared, Kay Jewelers, Nancy Reardon, Rapaport News, retail, Seb Hobbs, Sharon McCollam, Signet, Signet Jewelers, Virginia Drosos, zales
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