Michael Hill increases 2013 sales 6.8 percent in challenging environment

Tuesday 9th July 2013

Michael Hill International, the jewellery chain that bears its founder's name, increased sales 6.8 percent last year as it opened more stores in what the company said was a "challenging environment".

Sales climbed to $541.5 million in the 12 months ended June 30, from $507.3 million a year earlier when sales rose at a 4.6 percent pace, the Brisbane-based retailer said in a statement. Sales at stores open more than 12 months edged up 0.4 percent to $492.7 million, compared with a 0.3 percent decline the year earlier.

Shares in Michael Hill have slipped 0.8 percent the past three months, lagging a 2.2 percent gain in the benchmark index. Sales in the three months ended June were "difficult" for the jeweller with flat sales growth in its largest market of Australia and declining sales in its other three markets, chairman Michael Hill said.

"The directors are satisfied with the performance over the past 12 months, especially given the ongoing challenging environment," Hill said.

The shares last traded at $1.33 and are rated "buy" based on two recommendations compiled by Reuters, with a price target of $1.53.

In Australia, which accounts for two thirds of sales, total revenue rose 7.3 percent to $355.1 million from the year earlier. In the company's second-largest market of New Zealand, sales rose 1.3 percent to $110.5 million, while revenue climbed 15.4 percent to $63.6 million in Canada and inched up 2.8 percent to $12.3 million in the US.

BusinessDesk.co.nz

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