Michael Hill International, the jewellery chain business founded by its namesake, delivered 6.8 per cent sales growth in the three months to September 30 as it gears up for the busy Christmas period.

Group sales from all stores rose to A$120.2 million in the first quarter of Michael Hill's financial year, from A$112.5m in the same quarter in 2015. Same-store sales grew 2.8 per cent to A$114m in the three months.

The company now has two brands, Michael Hill and Emma & Roe, having moved the latter from trial phase into growth mode in the current financial year.

Michael Hill same-store sales rose 2.8 per cent to A$112.6m in the first quarter, while Emma & Roe same-store sales gained 1.5 per cent to A$1.4m. Total store sales for the Michael Hill chain increased 5.9 per cent to A$117.5m in the quarter, while Emma & Roe total sales jumped 72 per cent to A$2.7m in the period.

"The first quarter is not a crucial period for the business or for our full year results, but the results achieved across both brands were a satisfactory outcome," chief financial officer and acting chief executive Phil Taylor said.


"The Christmas period is the most critical quarter for the group's financial year result, and the management team is completely focused on execution of the next three months of trade."

In 2016, the jewellery chain posted a 30 per cent decline in annual profit to A$19.6m as it accounted for tax adjustments. In that year it grew revenue and earnings before interest and tax across its key Australian, New Zealand and Canadian markets and improved revenue in the US, bolstered by Emma & Roe.

In the first quarter of 2017, the Michael Hill brand traded well in Canada, up 7.6 per cent in same-store sales in local currency in the quarter with total store sales growth of 18 per cent to $21.6m Canadian dollars. Taylor said it appears the retailer is "continuing to take market share in this growth market as the competition continue to struggle."

Retail was challenging in Australia and US same-store sales fell 2.2 per cent in the quarter, but Taylor said the company's board were confident that a management restructure would return the segment to growth.

There were 300 Michael Hill stores trading at the end of September, and the company plans to open five more before Christmas and nine in the second half of the financial year.

Emma & Roe had 20 stores open at the end of the quarter, with four more to be opened before Christmas and at least four in the second half, the company said. The brand's same-store sales growth of 1.5 per cent wasn't as good as last year, but was "satisfactory given the slow start to the quarter in July and August," Taylor said.

Sales in Australia grew across same-store figures and all-store figures, up 2.1 per cent to A$1.3m and 78 per cent to A$2.6m respectively. New Zealand sales fell in both segments, down 11 per cent to NZ$137,282 in same-store sales and falling 6.9 per cent on all-store sales to the same figure as the jeweller didn't open any stores in this market.

September same store sales in Australia were up 14 per cent for the month on a year earlier, the company said, and two new stores opened in Sydney "have produced some pleasing early results," Taylor said.


The dual-listed shares were unchanged at $1.73 on the NZX.