Total Australian jewellery sales showed a “double-digit decline in sales for the first four months of the second half”, while group sales for the second half were down 3.5 per cent.
Total group sales for the full-year were up 5.5 per cent, the company announced today.
Michael Hill’s NZX announcement today said Bevilles leadership and retail team members, stores and corporate office had successfully transitioned to the Michael Hill Group.
“Bevilles is a fast-growing and profitable Australian jewellery retailer that centres its brand and products on the ‘value’ customer segment. As such, this provides a strong strategic fit and complements the strategy to elevate the Michael Hill brand to a ‘premium’ market positioning.”
The company said offers of new locations from landlords had been tabled while Michael Hill found the highest potential new locations.
Michael Hill’s half-year result posted in February showed record first-half revenue of A$363.4 million, up 11 per cent or A$30m compared to the previous half-year period, despite having 22 fewer stores operating and increasing margins.
Bracken said NZ’s weather events over the last few weeks did not affect its outlook. They said the company’s earnings would be ahead of the prior year if trading conditions “do not materially deteriorate”.
Net profit rose 1.2 per cent in the period to A$37.6m while New Zealand-specific revenue increased 13.8 per cent to NZ$76.3m.
Earnings before interest and tax (ebit) were up 6 per cent at A$54.5m at the end of 2022.
The jeweller had $198.2m worth of stock on hand as it increased its inventory during the pandemic.
The company declared an interim dividend of A$0.04 cents per share, which was at A$0.035 cents per share a year ago.
Refinancing
Michael Hill said its revolving credit facility requires refinancing before the end of the full year.
“Credit approval has been provided by ANZ and HSBC for the refinancing of a new three-year $90m facility. Formal documentation is expected to be executed prior to financial year close.”
The company said its new facility will support strategic initiatives including the national expansion of the Bevilles store network, the launch of the new digitally-led Bespoke diamond jewellery brand, and further the rollout of its gold recycling platform.
“Looking forward to the full-year 2024, I’m energised by the pipeline of strategic initiatives that underpin our growth aspirations for the group,” Bracken said.
Retail crime
The company has been hit with repeated robberies across the country, announcing last month that security guards will be in place at all 34 of Michael Hill’s North Island stores.
This came after daylight smash-and-grabs in the Bay of Plenty, Waikato, Wellington, New Plymouth and Mount Maunganui prompted the business to announce increased security measures in its stores across the country.
Security measures include fog cannons, additional security cameras, personal alarms for staff, alarm screamers and, in some stores, DNA sprays.
Bracken said the move was additional to existing security measures.
“We are continuing to review our security measures to ensure they are as robust and fail-safe as possible, whilst also working closely with New Zealand police on surveillance, security measures and apprehension of the criminals,” Bracken said.
