The company is planning for growth, says Sir Michael Hill. Photo / NZME.
The company is planning for growth, says Sir Michael Hill. Photo / NZME.
Michael Hill International posted flat first quarter sales as Australian sales declined in the less buoyant economic environment across the Tasman.
Same-store growth rose 0.3 per cent in the three months ended September 30 from the same period a year earlier to A$96.2 million ($107.2 million), the Brisbane-based jeweller said.On an all-store basis, sales rose 4 per cent to A$101.7 million. On a same-store basis Australian sales dropped 2 per cent to A$62 million, offsetting a 7 per cent gain in New Zealand stores to A$19.7 million and an 11 per cent rise in US stores to A$2 million. Canadian same-store sales rose 0.5 per cent to A$12.5 million.
The company has seen relatively flat sales in Australia and New Zealand, while it chases growth in the US. It launched a new brand, Emma & Roe, to target younger customers. The first quarter numbers don't include sales for the Emma & Roe stores, as the business develops its retail model.
In August, the company posted a 22 per cent drop in annual profit to A$25 million in the 12 months ended June 30, as sales rose 9.9 per cent to A$483.9 million. The company kept its annual dividend unchanged at A6.5c a share as its two largest units struggled to gain traction and it plans for future expansion.
"The decision to maintain dividends at the same level as 2012-13 reflects the flat trading conditions in our two most profitable markets, Australia and New Zealand," chairman Sir Michael Hill said at the time. "It also factors in the company's ambitions for growth in the coming years for both Michael Hill and Emma & Roe."
On a total store basis, first quarter sales for its Australian operations were flat at A$64 million. New Zealand sales rose 7.1 per cent to A$19.8 million, Canadian sales climbed 16 per cent to A$15.2 million and US sales jumped 22 per cent to A$2.6 million.
Shares in Michael Hill closed up 1c yesterday at $1.28.
The stock is rated an average of "buy" according to the consensus of three analysts as surveyed by Reuters, with a median price target of $1.55.
