Signet Slashes Fourth-Quarter Guidance Following Weak Holiday Sales 

Interior of Jared store image

Signet Jewelers’ stock fell 20% as the retailer reduced its guidance following lower-than-expected holiday sales. 

Same-store sales — at branches open for at least 12 months — slipped 2% year on year for the 10 weeks that ended January 11, the company reported in a trading update Tuesday. Many of the peak selling days leading up to Christmas fell below what the company had predicted, it noted. 

While sales of engagement rings and services performed well, the fashion category disappointed as consumers looked for better deals and cheaper goods than Signet had forecast, chief financial and operating officer Joan Hilson explained.  

“Fashion gifting underperformed as consumers gravitated to lower price points even more than anticipated in a continued competitive environment,” she noted. “Merchandise assortment gaps at key gifting price points impeded our ability to meet that trend.” 

As a result of the drop in sales over the holiday period, the retailer — which owns banners including Kay Jewelers, Zales, Jared and James Allen — has reduced its guidance for the fourth fiscal quarter. Total sales are now expected to be between $2.32 billion and $2.34 billion, compared with the $2.38 billion to $2.46 billion the jeweler initially reported. Meanwhile, same-store sales will decline 2% to 2.5%, versus the previous prediction that they would range from no change to an increase of 3%. Profit will reach between $337 million and $347 million compared to $397 million to $427 million, and the earnings before interest, taxes, depreciation and amortization (EBITDA) figure is set to come in at $381 million to $391 million. That was down from the original $441 million to $471 million. 

“While there were positives in the underlying business performance during [the] holiday, I believe we have the opportunity to reshape our customer-facing strategies in the areas of marketing, product design, and assortment innovation,” said Signet CEO J.K. Symancyk. “We can build on our industry-leading position in bridal while dramatically accelerating our reach into the larger fashion categories of self-purchase and gifting to drive sustainable organic growth.” 

Image: The interior of Jared store. (Signet Jewelers)

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Signet Slashes Fourth-Quarter Guidance Following Weak Holiday Sales 

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