Signet Jewelers sales slide in Q1

Diamond jewelry retailer Signet Jewelers reported on Thursday weaker than expected earning results for the fiscal first quarter, ended April 29, 2017.

The owner of the Kay, Zales and Jared brands reported net income of $78.5 million in the first quarter, down from $146.8 million recorded during the same period last year.

Same store sales declined 11.5 percent, which Signet attributed to the unfavorable timing of Mother’s Day, which is typically split between first quarter and second quarter.

“As anticipated, we had a very slow start to the year as continued headwinds in the overall retail environment were exacerbated by a slowdown in jewelry spending and company specific challenges. However, Signet's Q1 same store sales improved sequentially, when normalized for Mother's Day, and we were pleased with the holiday's results,” said Mark Light, Chief Executive Officer of Signet Jewelers, in a news statement.

Signet's total sales were $1,403.4 million, down $175.5 million, compared to an increase of 3.2 percent in the 13 weeks ended April 30, 2016. The number of transactions decreased across all divisions due to declining brick and mortar store traffic. E-commerce sales increased in the first quarter however, up 1.1 percent to $81 million.

The company also unveiled plans to outsource its credit portfolio through a phased process. The first phase is expected to be fully implemented by October 2017 and will begin with the sale of $1.0 billion of its prime-only credit quality accounts receivable to Alliance Data Systems Corporation.

As part of the second phase, Signet intends to fully outsource its secondary credit programs, including the sale of the remaining receivables on its balance sheet, as well as funding for new non-prime account originations.

Meanwhile, the company says it remains on-track to close approximately 165 to 170 stores in Fiscal 2018 and open about 90 to 115 stores.

Signet Jewelers sales slide in Q1

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