Signet Jewelers Limited, the international jewelry retailer, is set to acquire Diamonds Direct USA Inc. in a cash deal worth $490 million. The acquisition, expected to be finalized in the fourth quarter, will bring together two prominent players in the industry.
Diamonds Direct is highly regarded as a destination jeweler in the United States, operating off the mall. Signet recognizes the efficiency of its business model, as well as its impressive track record of growth and profitability. Once the acquisition is completed, Signet expects Diamonds Direct to immediately contribute to its overall success. Diamonds Direct is renowned for its customer-centric shopping experience, wide range of bridal products, attractive value proposition, and appeal to younger consumers. Signet plans to capitalize on its scale in purchasing, targeted marketing, and connected commerce to achieve operational synergies.
Virginia Drosos, the CEO of Signet, expressed great excitement about the acquisition, emphasizing its potential to drive shareholder value and help the company achieve its ambitious revenue goal of $9 billion. Itay Berger, the president of Diamonds Direct, also shared this sentiment, highlighting the shared passion for company culture and the immense potential for growth and innovation.
Following the completion of the acquisition, Diamonds Direct’s leadership will remain intact, with Berger reporting directly to Drosos. The brand will join Signet’s prestigious portfolio of jewelry retail brands, which includes renowned names such as Kay Jewelers, Zales, and Jared. Currently, Signet operates 2,800 stores worldwide.
In addition to the acquisition, Signet has raised its financial guidance for the third quarter and the full fiscal year. The company now anticipates third-quarter revenues to range between $1.42 billion and $1.45 billion, with a projected year-over-year increase in same-store sales of 10% to 12%. Previously, the guidance was set at revenues ranging from $1.26 billion to $1.31 billion. For the full fiscal year, Signet expects revenues to be between $7.04 billion and $7.19 billion, reflecting a same-store sales growth of 35% to 38%. The previous guidance predicted revenue in the range of $6.80 billion to $6.95 billion, with same-store sales growth between 30% and 33%.
Signet reported net income of $216.0 million on revenues of $1.8 billion in the second quarter of 2021. The company’s strong business momentum has contributed to the revision of its financial guidance.
Overall, Signet’s acquisition of Diamonds Direct and the upward revision of its financial guidance demonstrate the company’s commitment to growth and its dedication to offering a diverse and attractive range of jewelry options to its customers. By strategically acquiring businesses and leveraging its existing scale, Signet aims to continue delivering exceptional shopping experiences while driving value for its shareholders.
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Signet Jewelers Limited
Diamonds Direct USA Inc.
