Signet Jewelers closes all North American stores in response to Covid-19
Diamond retailer Signet Jewelers Limited is taking precautionary measures in response to the Covid-19 pandemic, announcing the temporary closure of all of its stores in North America, effective March 23, and taking steps to increase liquidity and cut expenses.
The store closures include the company’s Kay Jewelers, Zales, Jared, James Allen, Peoples and Piercing Pagoda banners, as well as the company’s support centers.
Employees of the company's North American stores will receive pay and benefits through April 4, in a combination of base pay and available paid time off provisions, CEO Virginia C. Drosos said, at which time the company will "further assess the situation."
In order to bolster its liquidity, Signet has accessed an additional $900 million from its senior secured asset-based revolving credit facility. At the time of drawdown on March 19, the company had more than $1.2 billion in cash and an additional $292 million available on this asset-based revolving credit facility.
In addition, the company said it will implement reduced work hours, furloughs, and reduced compensation across store and support center teams, including executives and board of directors, as part of an effort to reduce expenses.
“The exceptional team, capabilities, and agility we have built through our Path to Brilliance transformation over the past two years strongly position us to navigate this time of uncertainty," Drosos said.
"Retailers are already experiencing the severe impact of the impact of Covid-19 on the global economy, and we are anticipating continued reduction in consumer spend. We are moving quickly and aggressively to strengthen Signet’s financial flexibility, prioritize investments, and reduce capital expenditures and operating expenses.”
While the physical locations are shuttered, the company's e-commerce platforms will remain open. The company said it will determine when to re-open the stores based on the guidelines of government and health officials.
On January 16, Signet announced that its holiday period same store sales were up 1.6%, with North America same store sales up 2.0% and e-commerce sales up 13.5%.
The company will report its final fourth quarter and fiscal year 2020 results on Thursday, March 26.
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