Michael Hill has released its first trading update for the 2026 financial year – and New Zealand is dragging down its result. Photo / 123rf
Michael Hill has released its first trading update for the 2026 financial year – and New Zealand is dragging down its result. Photo / 123rf
Michael Hill’s New Zealand operation is continuing to struggle compared to its international segments, according to the latest update at the business’ annual shareholder meeting.
It was the first shareholder meeting for the business’ new chief executive Jonathan Waecker and the first since the loss of its founder Sir MichaelHill and former chief executive Daniel Bracken earlier this year.
Michael Hill chairman Rob Fyfe said the business had begun 2025 with cautious optimism, underpinned by economists’ forecasts of improving economic and trading conditions.
However, subdued consumer demand across Australia and New Zealand and persistent inflationary pressures across key input costs including occupancy, employee wages and gold all put pressure on margins.
“In the face of these challenges, I am immensely proud of the grace and determination demonstrated by our entire team. Despite the disruptions to our business, our people have shown resilience and unity, upholding our values and continuing to serve our customers with dedication,” Fyfe said.
“As we turn the page to a new chapter, we are excited to welcome our new CEO, Jonathan Waecker. Jonathan’s appointment marks a pivotal moment for the Michael Hill Group, bringing fresh leadership and new perspectives to guide our next phase of growth.”
However, New Zealand sales were down 5.5% compared with 4.4% growth in Canada and 1.2% growth in Australia.
Rob Fyfe (left) was planning to retire from Michael Hill's board, but the death of Sir Michael Hill and former CEO Daniel Bracken required him to remain for continuity.
That trend has continued in an update to shareholders for the first 16 weeks of the 2026 financial year, with total group sales down by 1.3%. That was partly influenced by a 4.4% reduction in stores over the period, down from 297 stores to 284.
Group same-store sales were flat compared to the same period in the previous year, with same store sales up 0.7% in Australia and up 4.1% in Canada. The New Zealand segment, however, was down by 6.2%.
The result did provide positive momentum on the business’ product and brand initiatives, with group gross margin recovery of roughly 100 basis points.
Fyfe said the business had taken decisive actions to strengthen its balance sheet, optimise inventory and reduce capital expenditure, ensuring it is well-positioned for sustainable growth and to leverage any recovery in market conditions.
He also mentioned a deliberate emphasis on embracing artificial intelligence (AI) across all facets of the business, with education for team members and integration with a range of business processes.
Looking to the festive season and the year ahead Waecker said the business was encouraged by the 100-basis-point lift in group gross margin and the performance of the Canada segment.
The business is planning to introduce new collections, including a vermeil gold-plated option, and broadening a range of customer favourites. It is also planning to expand its Christmas gift sets to support the peak trading period.
A new flagship store is set to open in Sydney’s Bondi in late October, along with the refurbishment of the brand’s Yorkdale store in Canada.
Waecker finished the meeting by thanking shareholders for their continued support and said he had begun a review of the business’ strategy to ensure its long-time success.
“While our foundations are strong, I see opportunities to sharpen our focus, accelerate innovation and deepen customer engagement. I look forward to working with the team as we build on our strengths and shape the next chapter of growth together.”
Michael Hill shares were down 1c to 40.5c today and are down more than 26% over the last year.
Tom Raynel is a multimedia business journalist for the Herald, covering small business, retail and tourism.
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