Signet Q4 sales fall; to open 20-30 stores, renovate 300

Signet Jewelers posted declines in its fourth-quarter and full-year sales amid a soft market for engagement rings, a late holiday season and “integration issues” at its online brands.

The parent company of Zales, Kay Jewelers, Jared and other brands reported that its sales fell 6.3% to $2.5 billion in the quarter ended Feb.3 (includes $103.2 million of sales from the company's 53rd week, partially offset by approximately $25 million from lost sales contribution from the sale of Ernest Jones stores).  Same store sales were down 9.6% 

Total sales in North America fell 6.1% to $2.49 billion, missing estimates of $2.55 billion, reflecting a decrease of 0.6% in total average transaction value on a lower number of transactions. Same-store sales fell 10% amid integration issues at the company’s online banners (James Allen and Blue Nile), which led to fulfillment issues in the second half of the quarter.

On the earnings call, CEO Virginia Drosos noted the company saw a “late shopper” during the holiday season and that industry was overstocked, which led to markdowns. 

For the full year, Signet posted total sales of $7.2 billion, down 11.9% from the previous year. Same-store sales fell 12%.

The company posted earnings per of $11.75, compared to $5.02 in the year-ago period. (The quarter included a $4.94 per share benefit of a deferred tax asset related to the enactment of the Corporate Income Tax Act of 2023   in Bermuda.) Adjusted per-share earnings of $6.73 topped Wall Street estimates of $6.37 per share.

For its current fiscal year, Signet expects capital expenditures of approximately $160 million to $180 million, reflecting investments in 20 to 30 new stores, nearly 300 renovations with focus on Kay, Jared and Diamonds Direct stores, connected commerce capabilities, and digital and technology advancement.

"As we look to fiscal 2025, we are expecting sequential same store sales improvement over the year as engagements gradually recover,” stated Drosos in the earnings release. “We believe we're positioned to win new customers through our marketing personalization, growing consumer inspired product newness, and aggressive expansion of our service business."

Signet expects first-quarter sales of $1.47 billion to $1.53 billion, with same-store sales down from 7% to 11%. Full-year sales are projected to be $6.66 billion to $7.02 billion. Same-store sales are expected to fall 5% to up to less than 1%.

Signet operates approximately 2,700 stores primarily under the name brands of Kay Jewelers, Zales, Jared, Banter by Piercing Pagoda, Diamonds Direct, Blue Nile, JamesAllen.com, Rocksbox, Peoples Jewellers, H. Samuel, and Ernest Jones.