Michael Hill Closes Stores, Lays Off Workers Despite Sales Growth

Michael Hill shut six of its stores and cut the positions of several senior executives in the first fiscal half, seeking to offset its operational costs amid market struggles.

The Australian jeweler closed five stores in Australia and one in Canada that were underperforming, it said last week. The move came even as the company saw a 4.1% rise in total sales to AUD 362.8 million ($239.3 million) due to the acquisition of the Bevilles chain of jewelry stores.

“While the first half was definitely a challenging period for our business, with sales for the core Michael Hill brand down, we are encouraged by our performance against the broader jewelry sector,” said Michael Hill CEO Daniel Bracken. “Clearly [our] margin was under pressure from both input costs and promotional activity, and inflationary forces saw elevated costs across many aspects of the business. As a result, the company has taken direct actions to reduce operating costs, including the exit of a number of senior management roles.”

Sales climbed 10% year on year in Australia to AUD 202.4 million ($133.5 million) and went up 0.6% in Canada to CAD 88.3 million ($65.7 million). In New Zealand, revenue fell 10% to NZD 65.4 million ($40 million).