Birks Group reports turnaround year in fiscal 2016

By

Obi Anyanwu

Published
Jul 6, 2016

Birks Group Inc. reported on Tuesday its financial results for fiscal year 2016 ended on March 26, 2016.

 
Net sales were $285.8 million compared to $301.6 million in the previous year, and comparable store sales increased by 3% compared to the prior year. Comparable sales increased 6% in Canada and 1% in the US despite reduced tourist activity in Florida.

Gross profit was $109.4 million, or 38.3% of net sales, versus $117.8 million, or 39.1% of net sales in the prior year, and net income was $5.4 million compared to a net loss of $8.6 million in 2015.

SG&A expenses decreased to $91.1 million, or 31.9% of net sales,  compared to $103.7 million, or 34.4% of net sales, and operating income increased $10.2 million to $15.5 million from $5.3 million due to the $3.2 million gain on sale of assets, lower restructuring charges and lower SG&A expenses.
 
Though net sales decreased in 2016, the net sales increased by $4.4 million on a constant currency basis and gross profit was in line with last year on a constant currency basis both after excluding $20.2 million of lower sales and $8.3 million of lower gross profit, respectively, due to the translation of Canadian sales into US dollars.
 
Jean-Christophe Bédos, President and Chief Executive Officer of Birks Group, said, “Following a year of restructuring our Company’s operations, the main factors that contributed to our success in fiscal 2016 included our continued dedication to enhancing customer experiences via our new store designs, the successful launch of our new collections and our creative marketing campaigns. We also strongly focused our efforts on strict cost controls and rigorous cash management while investing in the implementation of a new enterprise resource planning (“ERP”) system that we believe will help the Company offer better services with improved efficiency and productivity once it is completed. Furthermore, our undivided attention to growing the Birks brand through a more modern store environment, creative marketing and new jewelry collections, has delivered strong performances in both Canada and in the U.S. We believe that the Company is positioning itself to meet a challenging retail environment and to continue to produce positive results in fiscal year 2017.”
 
Birks operates 46 luxury jewelry stores in Canada, Florida and Georgia.