Michael Hill International says its same-store sales were up 7.3 per cent to A$116.7 million, and its online sales up 129 per cent, in its first quarter of trade in the 2021 financial year.
The jewellery company was able to increase its sales from A$108.8m ($117.1m) in the same period last year, with its Australian business making the largest portion of sales (A$64.2m), compared with A$57.1m a year earlier.
Michael Hill said its digital initiatives were paying off as it experienced a double-digit decline in its store foot traffic, delivering increased sales and margin growth across all three of its markets.
For the quarter, its digital channels represented 5.3 per cent of total sales, while its branded collections represented 43.3 per cent. It increased its membership base by 80 per cent since June to 260,000 members.
New Zealand same-store sales increased by 4.7 per cent in the quarter, while Australian sales grew by 12.5 per cent and 5.9 per cent in Canada.
Sales from the local business totalled $24.4m, up from $23.3m recorded in the quarter last year, while its Canadian sales increased to $32.2m (C$28.2m).
The company said it was in a strong financial position with a robust balance sheet.
Daniel Bracken, chief executive of Michael Hill, said the group's focus had shifted from top-line sales and market share recovery to a balance of both margin and sales growth, underpinned by its strategic initiatives.
"It is encouraging to see so many of these strategies now flowing through to our results," Bracken said in the company's first-quarter trading update.
"Undoubtedly, the business has been and will continue to be impacted by the Covid-19 pandemic, with uncontrollable impacts on our store network, as seen in Melbourne and Auckland, and ongoing lower foot traffic. To navigate the impacts of the pandemic, the company has put in place a number of measures - strong health and safety protocols, accelerating virtual selling and try-ons and rolling out multiple digital initiatives."
Bracken said the group would continue to focus on new opportunities that would "gather pace through the coming quarter and over the balance of the year".
He said "a continued disciplined fiscal mindset" had seen a "cost-conscious culture now truly embedded as a key pillar of business performance".
"The company is well positioned as we enter our all-important Christmas trading period with a healthy balance sheet and reinvigorated teams in all markets. A well-managed supply chain, an exciting merchandise offer, and our best ever Christmas marketing campaign provide confidence that we can maintain strong momentum across the most significant quarter of the year."
Michael Hill closed 15 underperforming stores and faced temporary closures of 44 stores (28 in Melbourne and 16 in Auckland) due to the further lockdowns in the quarter, which resulted in all store sales declining by 3.6 per cent.
The group operates 289 retail stores.