Signet Jewelers Holiday Sales Down, Cuts Q4 Sales View Below Market; Stock Down In Pre-market

Signet Jewelers

57.50 USD -0.88%

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(RTTNews) - Shares of Signet Jewelers Limited (SIG) were losing around 21 percent in pre-market activity on the NYSE after the retailer of diamond jewelry reported Tuesday weak Holiday sales, and trimmed its forecast for its fourth quarter.

The company's Same store sales or SSS for ten-week Holiday period ended January 11 decreased approximately 2 percent to last year.

Merchandise Average Unit Retail or AUR increased approximately 5 percent on lower traffic and conversion.

Looking ahead, for the fourth quarter, the company now expects total sales of $2.320 billion to $2.335 billion, lower than previous estimate of $2.38 billion to $2.46 billion.

Wall Street analysts on average expect the company to report sales of $2.42 billion. Analysts' estimates typically exclude special items.

Same store sales is now expected to drop 2 percent to 2.5 percent, compared to flat to 3 percent growth expected earlier.

Adjusted operating income is now projected to be $337 million to $347 million, lower than previous estimate of $397 million to $427 million. The company now expects adjusted EBITDA of $381 million to $391 million, compared to previously projected $441 million to $471 million.

Joan Hilson, Chief Financial and Operating Officer, said, "Our holiday results of approximately -2 percent SSS reflect peak selling days leading up to Christmas that were below forecast. Engagement and Service sales were within expectations and we saw AUR increase in both Bridal and Fashion. However, fashion gifting underperformed as consumers gravitated to lower price points even more than anticipated in a continued competitive environment. Merchandise assortment gaps at key gifting price points impeded our ability to meet that trend."

In pre-market activity on the NYSE, Signet shares were trading at $58.75, down 20.7 percent.