Michael Hill 9-month total store sales rise 5.5%

Michael Hill International's newly opened stores in Australia and Canada helped drive a 5.5 percent increase in sales in the first nine months of its financial year, outpacing an increase in same-store revenue as trading in New Zealand and the US remained tough.

In the flagship jewellery chain stores, the retailer posted a 4.4 percent increase to A$435.6 million in nine-month sales, while same-store gained a more modest 0.8 percent to A$411.5 million, the Brisbane-based retailer said in a statement. For the Emma & Roe brand, sales jumped 70 percent to A$11.8 million but same-store sales growth slipped 1 percent to A$5.6 million. Total sales rose to A$447.4 million in the nine months through March from A$424 million a year earlier.

Eight Michael Hill stores and 10 Emma & Roe stores were opened during the period, giving the company a total of 330 stores trading as at March 31, including 304 Michael Hill stores and 26 Emma & Roe stores. The company plans to open eight Michael Hill stores and four Emma & Roe stores in the final quarter of the year.

Trading conditions in its two biggest markets, Australia and New Zealand, "continued to be challenging," it said. Same-store sales rose 0.4 percent in Australia in the nine months in Australian dollars. The New Zealand business segment finished down 1.4 percent for the period in New Zealand dollars.

In the US the business "continues to struggle" and same-store sales fell 11 percent while total sales for all stores fell 9.1 percent in US dollars. It underscored, however, after some management changes in September last year it is in the process of rebuilding for this test market.

The Canadian business continued to outperform for the retailer with same-store sales growth of 7 percent and all store growth of 17 percent.

While Emma & Roe same-store sales were down in the third quarter, Michael Hill said it has secured and opened some new locations in Queensland and New South Wales which will "allow us to increase our marketing spending in the following 12 months as critical mass is achieved in each advertising region."

Michael Hill's dual-listed shares were down 1.3 percent at $1.48 on the NZX and have gained 55 percent over the past year.

(BusinessDesk)