Signet Jewelers Limited · NYSE:SIG
Signet Jewelers — Q4 FY2014 Earnings Presentation
21 slides from Signet Jewelers's earnings presentation, Mar 27, 2014
Slide 1: Fiscal 2014 Fourth Quarter and Full Year Results
Every kiss begins with Kay.® Fiscal 2014 Fourth Quarter and Full Year Results Thursday, March 27, 2014 1
Slide 2: Forward Looking Statements & Other Disclosure Matters
Forward Looking Statements & Other Disclosure Matters Forward-Looking Statements - This presentation contains statements which are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements, based upon management's beliefs and expectations
Slide 3: Fourth Quarter Fiscal 2014 Financial Results
Fourth Quarter Fiscal 2014 Financial Results Same store sales up 4.3% US division up 4.0%, led by Kay +4.9% and Jared +4.1% UK division up 5.7%, led by Ernest Jones +8.5% and H.Samuel +3.6% Operating income $270.6 million Diluted earnings per share $2.18 3
Slide 4: Fourth Quarter Fiscal 2014 Highlights
Fourth Quarter Fiscal 2014 Highlights US Division Strong performance across a variety of merchandise categories Bridal, colored diamonds, fashion jewelry, beads and watches all performed well Branded differentiated and exclusive brands +21.8% UK Division Strong growth in bridal and fashion diamond j
Slide 5: Zale Acquisition Update
Zale Acquisition Update Complementary strengths supports Signet growth strategies Opportunity to contribute Signet’s expertise and together with Zale’s team, improve Zale performance Cost-effective financing alternatives Synergy opportunities: $100 million within first 3 fiscal years after closing,
Slide 6: Fiscal 2014 Results and Highlights
Fiscal 2014 Results and Highlights Same store sales up 4.4% US division up 5.2% UK division up 1.0% Record profitability Operating income $570.5 million, up 1.8% Diluted earnings per share $4.56, up 4.8% Repurchased 1.9% of outstanding shares Increased dividend Acquired rough-to-polished factory in
Slide 7: US Performance
US Performance Change in same Change in total Fiscal 2014 Total sales store sales¹ sales Kay $2,157.8m 6.5% 9.0% Jared $1,064.7m 4.7% 6.1% Regionals $295.1m (2.4)% 1.2% US division $3,517.6m 5.2% 7.4% US division Operating income $553.2m up 1.0% Operating margin 15.7% down 100 bps 1. Based only on s
Slide 8: FY 2014 US Performance Drivers: Merchandise
FY 2014 US Performance Drivers: Merchandise ® ® Broad based sales growth Branded differentiated and exclusive merchandise gained relative share Sales up 23.2% 31.1% of merchandise sales Bridal up double-digit percentage; remains about half of business 8
Slide 9: FY 2014 US Performance Drivers: Marketing
FY 2014 US Performance Drivers: Marketing Everyone knows Every Kiss Begins With Kay ® and He Went to Jared ® Outstanding, creative advertising engages customers emotionally and drives sales Industry-leading share of voice Every kiss begins with Kay® He went to Jared! ® 9
Slide 10: FY 2014 US Performance Drivers: Best-in-Class Digital Ecosystem
FY 2014 US Performance Drivers: Best--in Best in--Class Digital Ecosystem Websites On- On-line Search Education Engines Center Social Digital Media Advertising Signet eCommerce Sales, $m eMail Mobile Customer 175.0 $164.1 Targeting 150.0 $129.8 $35.1 eCommerce 125.0 $28.4 100.0 $92.3 75.0 $67.6 $23.
Slide 11: UK Performance
UK Performance Change Change Change in same in total in total Total store sales at sales as Fiscal 2014 sales sales¹ CER² reported H.Samuel $368.9m (0.3)% (4.2)% (4.7)% Ernest Jones $316.7m 2.6% (1.1)% (1.8)% UK division $685.6m 1.0% (2.8)% (3.4)% Operating income $42.4m up 6.0% Operating margin 6.2
Slide 12: UK: Committed to Long-Term Plan
UK: Committed to Long--Term Plan Long Primary focus on merchandise assortment Real estate and channel optimization Cost control 12
Slide 13: 2014: Supported Goal By Executing Strategies
2014: Supported Goal By Executing Strategies Maximize mid-market Best in bridal Best-in-class digital ecosystem Expand our footprint People, purpose and passion 13
Slide 14: Fourth Quarter Fiscal 2014 Sales Performance
Fourth Quarter Fiscal 2014 Sales Performance US Other¹ UK Total Sales Q4 2014 $m 1,288.0 3.8 272.2 1,564.0 Sales Q4 2013 $m 1,244.9 — 268.4 1,513.3 Change in sales % % % % Change in same store sales²,³ 4.0 — 5.7 4.3 Non-same store sales, net³,⁴ 3.2 NM (1.1) 2.7 Impact of 14th week (3.7) — (5.1) (4.0
Slide 15: Fourth Quarter Fiscal 2014 Reconciliation
Fourth Quarter Fiscal 2014 Reconciliation Signet % of sales Operating income Q4 2013 $267.7m 17.7% Gross margin movement $11.7m (0.6)% Selling, general & admin. expense $(14.9)m (0.1)% movement Other operating income movement $6.1m 0.3% Operating income Q4 2014 $270.6m 17.3% Diluted earnings per sha
Slide 16: SG&A Bridge
SG&A Bridge ( ) = decrease % of sales SG&A Q4 Fiscal 2013 $410.9m 27.1% Change in US $15.6m Change in UK $0.1m Corporate $(0.8)m SG&A Q4 Fiscal 2014 $425.8m 27.2% 16
Slide 17: Fiscal 2014 Inventory
Fiscal 2014 Inventory Ending inventory was $1,488.0 million, up $91.0 million or 6.5%, which includes: New stores increased inventory by $40 million Investment in bridal increased net inventory by $20 million Signet’s diamond sourcing initiative inventory of $53.5 million, which was up $17.4 million
Slide 18: Credit Statistics
Credit Statistics Fourth Quarter Fiscal 2014 Fiscal 2013 Accounts receivable, net $1,374.0m $1,205.3m Credit participation – US 55.5% 53.5% US average monthly collection rate 11.5% 11.9% Year to Date Fiscal 2014 Fiscal 2013 Accounts receivable, net $1,374.0m $1,205.3m Credit participation – US 57.7%
Slide 19: Credit Statistics
Credit Statistics Fourth Quarter Fiscal 2014 Fiscal 2013 Net bad debt ($45.5)m ($41.1)m As a % of US sales 3.5% 3.3% Other operating income, net $47.6m $41.5m As a % of Signet sales 3.0% 2.7% Net Impact $2.1m $0.4m Year to Date Fiscal 2014 Fiscal 2013 Net bad debt ($138.3)m ($122.4)m As a % of US sa
Slide 20: Financial Guidance
Financial Guidance First Quarter Fiscal 2015 Same store sales 3% to 4% Diluted earnings per share – Signet $1.24 - $1.28 Diluted earnings per share – Acquisition Costs ($0.10) – ($0.08) Diluted earnings per share – Signet including $1.14 - $1.20 Acquisition Costs Fiscal 2015 Capital spending $180 mi
Slide 21: Fiscal 2014 Fourth Quarter Results
Every kiss begins with Kay.® Fiscal 2014 Fourth Quarter Results Thursday, March 27, 2014 21