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Signet Jewelers Beats Earnings Expectations Despite Revenue Drop


Signet Jewelers, a leading jewelry retailer, reported a revenue decline of over 10% in the third quarter. However, the company managed to beat earnings expectations thanks to cost-saving measures that have started to take effect.

Revenue and Same-Store Sales

During the quarter, Signet’s revenue fell by 12.1% to $1.4 billion, which was in line with analysts’ expectations. Same-store sales also experienced a decline of 11.8%.

Adjusted Earnings Per Share

Signet exceeded consensus calls for earnings per share, reporting 24 cents compared to the expected 18 cents. This is a positive outcome for the company.

Cost Saving Measures and Inventory Management

Joan Hilson, Signet’s Chief Financial, Strategy, and Services Officer, mentioned that the company’s cost-saving initiatives are on track. Additionally, Signet’s healthy inventory will enable the introduction of new products in preparation for the upcoming holiday season.

Revised Guidance for Fiscal 2024

Signet slightly adjusted its guidance for fiscal 2024 to reflect the recent sale of 15 luxury stores in the U.K. Revised sales are estimated to range between $7.07 billion to $7.27 billion, while earnings per share are projected to be between $9.55 and $10.18. Analysts predict earnings to reach $9.81 per share, with sales totaling $7.2 billion.

Store Sale Details and Impact

The stores that were sold off are part of the Ernest Jones banner. Furthermore, Signet may sell up to six additional retail locations by the end of the fourth quarter. The expected pretax gain from these sales is approximately $12 million, which will positively impact Signet’s fourth-quarter results.

Fourth-Quarter Sales Outlook

Signet anticipates fourth-quarter sales to range between $2.40 billion and $2.60 billion. CEO Virginia Drosos noted that trends, including a sequential improvement in engagement, are aligned with expectations for the final quarter of the year.

Stock Performance

On Tuesday, Signet stock ticked up 0.6% to $85.50. It is worth highlighting that the company’s shares have gained 25% this year, outperforming the S&P 500’s 18% rise.

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