Michael Hill sales drop 10% due to lockdowns; digital sales jump 58%
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Michael Hill’s digital sales jumped 58% in the first quarter as many of his stores were closed due to closures.
Jeweler Michael Hill International said sales fell 10% in the first quarter as many of its stores in Australia and New Zealand were closed due to closures.
Sales fell to A $ 107.6 million (NZ $ 114 million) in the 13 weeks to September 26, from A $ 119.5 million last year, the company based in Brisbane in a statement to the NZX. It lost 7,396 trading days in-store during the quarter, compared to 2,158 days in the same quarter last year, representing a net loss of 20%.
Excluding the impact of store closings, sales increased 16 percent. Digital sales jumped 58% to 9.4% of total sales, up from 5.3% of sales last year, and the company’s profit margins rose 100 to 200 basis points.
Like many retailers, Michael Hill benefited from sustained consumer spending during the Covid pandemic, making an additional A $ 42.2 million in profit last year and ending the year with no debt and no cash surplus of 72. , AU $ 4 million.
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Managing Director Daniel Bracken warned in August that lockdowns were squeezing current year profits, but he said on Wednesday that higher margins, cost control, digital growth and strong sales in stores remained open mitigated the negative impact on the profits of the lockdowns.
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In New Zealand, first-quarter sales fell 13% to $ 22.1 million, with a five-week lockdown resulting in the loss of 1,333 trading days. At the end of the quarter, 16 Auckland stores remained closed, out of a total of 49 New Zealand stores. Excluding the impact of store closings, same store sales increased 18%.
Michael Hill received $ 739,000 in government wage subsidy payments for 322 employees linked to the latest lockdown, according to Work and income records.
In Australia, first-quarter sales fell 25% to A $ 48.8 million, with 71 of the company’s 150 stores being closed for most of the period. Same store sales increased 9.4%.
In Canada, first quarter sales increased 19% to C $ 35 million (NZ $ 41 million). By early July, all 86 stores were open and trading, with just 132 trading days lost in the quarter, the company said.
âUpon reopening, our Canadian business flew, generating impressive growth in sales and margins every week,â said Bracken. “This shows that as the territories reopen, the company is ready to meet strong consumer demand.”
Bracken said he looked forward to the gradual opening of the company’s Australian and Auckland stores ahead of the “very important” Christmas trading period.
Michael Hill shares rose 5.3% to a three-year high of $ 1 by mid-afternoon on the NZX.