US-based jeweller Signet's (SIG) full-year results have been rather overshadowed by recent news that it is to acquire listed rival Zale Corporation for $1.4bn (£84m). Chief executive Mike Barnes said the acquisition would take Zale "to the next level" and transform Signet by diversifying the business, extending its international footprint and giving it huge operational leverage.
Since the announcement on 19 February, the shares have jumped by more than 31 per cent, helped by a 6 per cent leap after the company reported like-for-like sales growth of more than 4 per cent in its full-year results. Growth came from the US business, where total sales grew 7 per cent to $3.52bn, with a 5 per cent underlying increase. Shoppers flocked to Signet's chains Kay and Jared for items such as bridal jewellery, coloured diamonds and watches, while branded merchandise was a big hit, too. Online sales surged 27 per cent to $129m.
Growth in the UK was more muted, but better than last year. Sales at Ernest Jones and H Samuel fell 3 per cent to $686m, but same-store sales were 1 per cent higher.
Prior to the results announcement, broker Brean Capital was expecting a 13 per cent rise in diluted EPS this year to 510¢.
| SIGNET JEWELERS (SIG) | ||||
|---|---|---|---|---|
| ORD PRICE: | 6,248p | MARKET VALUE: | £5bn | |
| TOUCH: | 6,238-6,251p | 12-MONTH HIGH: | 6,453p | LOW: 4,059p |
| DIVIDEND YIELD: | 0.6% | PE RATIO: | 22 | |
| NET ASSET VALUE: | 3,195¢ | NET CASH: | $228m | |
| Year to Feb | Turnover ($bn) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2010 | 3.27 | 230 | 184 | nil |
| 2011 | 3.44 | 300 | 234 | nil |
| 2012 | 3.75 | 502 | 376 | 20 |
| 2013 | 3.98 | 557 | 437 | 48 |
| 2014* | 4.21 | 567 | 459 | 60 |
| % change | +6 | +2 | +5 | +25 |
*Final dividend of 15¢ paid on 27 Feb. First-quarter dividend payment in respect of 2015 financial year of 18¢ to be paid on 28 May with ex-div date of 30 Apr £1=$1.66 | ||||
