Signet Rebounds Ahead of Holiday Season

In the COVID-19 era, consumers are increasingly staying online even to buy jewelry.  

In its third-quarter 2021 earnings report Thursday, Signet Jewelers Ltd. said e-commerce sales soared 71.4 percent to $238.8 million. The company, whose portfolio includes the Jared, Zales and Kay brands, also pointed to a broader growth in sales during a year in which customers have tended to prioritize essential purchases. 

In the quarter ended Oct. 31, the company said same-store sales rose roughly 15 percent and that it logged some $1.3 billion in revenue, a 9.5 percent increase from last year. Operating income was about $40 million, and non-GAAP earnings per share were $0.11. 

In a call with analysts Thursday morning, Signet chief executive officer Virginia Drosos attributed the company’s apparent rebound from the earlier phase of the pandemic, which led to lockdowns of nonessential stores around the U.S., to its “intentional efforts to capture both pent up demand and early holiday sales.” 

Drosos said the sales growth also reflects increasing sales at physical locations, of which more than 90 percent were open this quarter. Brick-and-mortar same-store sales were up 6.8 percent in the quarter.  

“COVID-19 has changed consumer behavior, but not just in terms of when or where they shop,” Drosos said. “This experience has prompted people to pause and to reflect on the relationships that matter most to them.”

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Wall Street appeared to share some of that enthusiasm. The company’s shares were up roughly 2 percent in mid-morning trading to $30.34. 

The results come at a time when the pandemic is surging again worldwide and health officials warn of a dangerous winter season spread of the illness. On Wednesday, Centers for Disease Control director Robert Redfield told the lobbying group U.S. Chamber of Commerce that hospitalization rates are rising and noted that there were more than a million cases reported each week in November alone. The number of daily new cases and fatalities are also spiking. According to the latest Johns Hopkins University daily tally as of Thursday, there were more than 200,000 new COVID-19 cases reported Wednesday, and a single day record of 2,804 deaths.  

But unlike during the early months of the pandemic, nonessential retailers around the country have kept stores open. The shutdowns of the earlier months of the pandemic have also pushed a number of retailers into bankruptcy, and caused them to permanently shrink their physical footprint. In June, Signet said it was planning to shutter 400 stores. 

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