The jewellery company Sir Michael Hill founded in 1979 is going through a bit of a rocky patch, with the stock price falling 15% in the past 12 months.
Michael Hill International’s decade-long investment into the US market didn’t pan out, with the company closing its nine stores there after millions of dollars were lost each year.
Its Emma & Roe brand – the brainchild of Sir Michael’s daughter Emma, who chairs the company – has also suffered, and is being overhauled to pitch into the fast-growing demi-fine jewellery segment.
The dual-listed company reported in February that net profit after tax for the six months to December 31 was $A8.7 million, down 66% from $A40 million in the same period the year before.
Earnings before interest and tax dropped 62% to $A15.1 million from $A40 million the year before.
However, e-commerce figures have picked right up as the company plugs more resource into growing online, and the Canadian market looks promising for the brand. The latest quarterly figures show improved same-store performance in New Zealand, although the Australian retail environment remains tough.
Durante Holdings – the investment vehicle for interests associated with Sir Michael – holds 52.9% of shares in Michael Hill International.
The Hill family trust – Hoglett Hamlet – sold down its stake in the business to 38.6% in October 2016 to enhance liquidity. The family obviously has a sense of humour, with other trusts associated with the business named Heffalump Holdings, Mole Hill Ltd and Squeakidin Ltd.
While no longer hands-on with the business, 79-year-old Sir Michael is kept busy with his other passions – golf, music and philanthropy. In 2001 he founded the biennial Michael Hill International Violin Competition, for emerging young violinists.
Sir Michael has a 202-hectare 18-hole golf course – called The Hills – on his $6.25 million hilltop property near Arrowtown, which hosts the annual NZ Open.