24 Jan 2014

Michael Hill sales results mixed

7:31 am on 24 January 2014

Michael Hill International has reported mixed trading in the six months to December, with sales in its New Zealand arm falling.

Same store sales, a key indicator, rose to $A248 million, an incease of 4.7 percent compared with the same period in 2012.

Michael Hill says the Group achieved solid growth over the period, due in part to the weaker Australian dollar, which the company now reports in.

When expressed in local currency, same store sales in its New Zealand stores declined more than 4 percent to $NZ60.5 million.

The jeweller says this was due in part to the settling in of a new retail management team halfway through 2013, and it's confident this decline will be reversed in the coming months.

Same store sales in Australia grew more than 1 percent while sales in Canada improved nearly 8 percent.

In the US market, seen as hard to break into, sales grew 2 percent despite severe weather conditions in the run-up to the key Christmas period.

Michael Hill chief executive Mike Parsell says the first half was mixed and overall the revenue was satisfactory.

He says the company did well in Canada, held its ground in Australia and lost a little ground in New Zealand.

Mr Parsell says the Group has incurred additional costs as it gears up for its next phase of expansion, so that has affected the bottom line.

Michael Hill International is expecting half-year operating earnings to be in the $A29 million - $A30 million range. The half-year results are due out on 14 February.