Michael Hill's exit from the US starting to pay off

Michael Hill's exit from the US starting to pay off

After shutting up shop in the United States and reducing its Australian footprint Michael Hill is starting to see some success again.

At the end of December 2018, the jewellery retailer's statutory NPAT rose by 125 per cent to $19.5 million, compared to $8.5 million at the same time a year ago.

Earnings also rose during the period by 85 per cent to hit $28.5 million.

Chair Emma Hill says these results are the reflection of a business in transition.

"The company made a series of challenging but necessary changes over the past year, as it transitioned to a new strategy focused on the core Michael Hill brand and long-term sustainable growth," says Hill.

Though statutory earnings were up, underlying earnings dipped by 16 per cent to $29.6 million.

Total group revenue for the first-half was $315.4 million, down 2.7 per cent on the prior year, as a result of weaker trading in the first four months of the half.

The group's online play continues to succeed with e-commerce sales increasing by 68.3 per cent to $9.5 million during the half.

Six Michael Hill stores opened, and three under-performing stores were closed during the period, meaning Michael Hill now has 311 stores as of 31 December 2018.

A new CEO, Daniel Bracken, joined Michael Hill in mid-November after Phil Taylor resigned because of health issues. Emma Hill says that Bracken has already brought the business forward.

"Since joining the company in mid-November, Daniel has already proven to be an outstanding addition and the Board is energised by his early contributions and insights," says Hill.

"The company enters this new era under Daniel with plenty of enthusiasm, but also with a number of key learnings from the past 12 months."

"A shift away from a high frequency of deep discount event days had a material impact on revenues during the July to October period. A more integrated approach to our promotional and sales activities was made ahead of the Christmas trading period, which resulted in a strong turnaround in sales momentum across November and December, but not at a sufficient level to offset the lower trading volumes experienced in the four months prior."

Shares in Michael Hill are up 8.11 per cent to $0.60 per share at 11.12am AEDT.

Never miss a news update, subscribe here. Follow us on Facebook, LinkedIn, Instagram and Twitter.

Business News Australia

Enjoyed this article?

Don't miss out on the knowledge and insights to be gained from our daily news and features.

Subscribe today to unlock unlimited access to in-depth business coverage, expert analysis, and exclusive content across all devices.

Support independent journalism and stay informed with stories that matter to you.

Subscribe now and get 50% off your first year!

Four time-saving tips for automating your investment portfolio
Partner Content
In today's fast-paced investment landscape, time is a valuable commodity. Fortunately, w...
Etoro
Advertisement

Related Stories

Cash transporter Armaguard receives $50m lifeline to stay afloat

Cash transporter Armaguard receives $50m lifeline to stay afloat

As cash processing, storage and transport company Armaguard struggl...

Cettire loses $411m in value as shares plummet 48pc

Cettire loses $411m in value as shares plummet 48pc

All of the extraordinary share price gains made by Melbourne-based ...

Fines of $10 million will force supermarkets to rethink exploiting suppliers, but more could be done

Fines of $10 million will force supermarkets to rethink exploiting suppliers, but more could be done

Suppliers of food and other products have been complaining for year...

From Just Jeans to Dotti, Myer proposes merger with Premier's apparel brands

From Just Jeans to Dotti, Myer proposes merger with Premier's apparel brands

Myer's (ASX: MYR) new executive chair Olivia Wirth has wasted l...