Signet Jewelers Limited has reported a widened net loss of $36.1 million in the second quarter of 2019, compared to $23.0 million in the same period last year. This disappointing result was primarily driven by a decrease in sales in Signet’s international segment, exacerbated by costs associated with the company’s ongoing transformation plan. Overall quarterly sales decreased by 3.9% to $1.36 billion, with a 1.5% decline in same store sales compared to the previous year.
Despite facing challenges in the sales environment, Signet’s e-commerce channel showed promise with a 4.4% increase in revenue, accounting for 11.5% of total sales. However, the brick-and-mortar channel experienced a decline of 2.3% in same store sales. Among Signet’s brands, Zales and Piercing Pagoda were the only ones to achieve positive comparable sales in the second quarter.
The international segment of Signet faced significant struggles, with a 7.0% decline in same store sales primarily driven by difficulties in the UK market. In North America, total same store sales decreased by 1.0%, with growth in e-commerce sales offset by declines in brick-and-mortar sales. While the fashion category showed strength in North America, bridal, watches, and other categories saw disappointing results.
Signet’s transformation plan, known as Path to Brilliance, aims to deliver substantial cost savings in the coming years, with charges of $27.8 million recorded in the second quarter. As part of the restructuring efforts, the company closed 66 stores and opened 16 new ones, bringing the total number of retail locations worldwide to 3,284. Progress was seen in the first six months of the year as the net loss was significantly reduced.
Looking towards the future, Signet’s CEO, Virginia C. Drosos, is optimistic about the company’s strategy for the upcoming holiday season. The focus will be on launching new brands, offering trendy merchandise, and providing competitive offerings for value-conscious shoppers. For the third quarter, Signet anticipates total sales to fall between $1.14 billion and $1.16 billion, with an expected decline in same store sales and diluted loss per share. Additionally, Signet plans to secure new credit facilities to finance various projects, including a tender offer for outstanding senior notes and refinancing existing credit facilities.
To learn more about Signet Jewelers Limited and its financial updates, you can visit their official website here. For additional information on the jewelry industry and market trends, you can explore related articles on the National Jeweler website here.
