Signet Jewelers Limited · NYSE:SIG
Signet Jewelers — Non-Deal Roadshow (January 2009)
82 slides from Signet Jewelers's roadshow presentation, January 2009
Slide 1: Roadshow January 2009
S IGNET J] EW ELLER S Roadshow January 2009 HSAMUEL SIG KAY JEWELERS THE JEWELLER LISTED ‘Every kiss begins with Kay?
Slide 2: Safe Harbor Statement
Safe Harbor Statement (Private Securities Litigation Reform Act of 1995) This presentation include 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 as well as on assumptions m
Slide 3: World's Largest Specialty Jeweler
World’s Largest Specialty Jeweler Kay Jewelers - #1 in US H.Samuel - #1 in UK Sales: c.$1.4bn Stores: 926 in 50 states Sales: c.£250m Stores: 351 Jared - #1 Off-Mall “Category Killer” Ernest Jones - #1 UK upper middle market Sales: c.$700m Stores: 171 in 35 states Sales: c.£205m Stores: 206 3 Expect
Slide 4: Strong Operationally
Strong Operationally Ö Operational strengths Ö more externally qualified staff Ö leading middle market supply chain / merchandise practices Ö largest marketing budget Ö high return real estate Ö Ability to maintain competitive advantages Ö Experienced management 4 4
Slide 5: Operating Performance Fiscal 2009
Operating Performance Fiscal 2009 Ö “Group same store sales were down by 15.2% in the 9 weeks to January 3, 2009.” Ö “In the 48 weeks to January 3, 2009 Ö same store sales down 8.1% Ö total sales down 5.5% at constant exchange rates” Ö “Income before tax expected to be between $180m and $195m after
Slide 6: Financial Performance Fiscal 2009
Financial Performance Fiscal 2009 Ö “A cash outflow of about $30m before foreign exchange adjustments Ö after dividend payments of $124m Ö capital expenditure of c.$115m” Ö “Year end net debt forecast to be $470m to $490m Ö gearing expected to be c.29% at year end” Ö “Trading within the requirements
Slide 7: US Jewelry
US Jewelry “Further growth from a proven strategy” 7 7
Slide 8: US Business Characteristics
US Business Characteristics Ö Driven by bridal and gift giving categories Ö c.75% of sales diamond jewelry Ö c.45% bridal related Ö bridal more resilient than gift giving Ö Kay and Regional brands Ö customer’s household income c.$67,000 Ö average transaction value of c.$330 Ö Jared Ö customer’s hous
Slide 9: Fiscal 2009 Financial Performance
Fiscal 2009 Financial Performance Ö Same store sales down 16.4% over Christmas Ö gross margin expected to be up c.250 bpts Ö highly promotional retail marketplace Ö 9.5% same store sales decline for 48 weeks Ö 5.9% total $ sales decline for 48 weeks Ö Operating margin anticipated to be about 7% Ö c.
Slide 10: Holiday Competitor Performance
Holiday Competitor Performance Ö Zale (inc. Canada) down 19.5% Ö Finlay Ent. down 20.1% Ö Birks & Mayors (US) down 31% Ö Shane total sales down 32% Ö Tiffany (US) down 35% Ö JC Penney down 9.6%, fine jewelry continued to experience softer sales Ö Wal-mart, jewelry sales were soft Ö Many reported low
Slide 11: Trading Environment
Trading Environment Ö Extremely challenging retail marketplace Ö lack of consumer confidence Ö highly promotional Ö Jewelry sector & supply chain very fragmented Ö Many competitors and suppliers in weak financial condition Ö Industry consolidation accelerated in 2008 Ö expected to continue in 2009 1
Slide 12: Priorities in Fiscal 2010
Priorities in Fiscal 2010 Ö Action to realign trading stance Ö maximize gross margin dollars Ö cost reduction Ö reduce inventory levels Ö continued focus on performance of receivables Ö lower capital expenditure Ö cash generation rather than space growth Ö Maintain sector leading position Ö utilize
Slide 13: Maximize Gross Margin Dollars
Maximize Gross Margin Dollars Ö Staff training Ö Development of exclusive merchandise Ö proven ability e.g. Leo range Ö Jane Seymour, Le Vian, Russell Simmons Ö marketing leverage Ö Selective promotional activity Ö greater frequency of targeted activity Ö more rapid clearance of slowing SKUs Ö enhan
Slide 14: Cost Control Actions
Cost Control Actions Ö Review all costs Ö Flex store staffing Ö minimum level required Ö retain well trained, motivated staff Ö Realign marketing spend with focus on most productive bands and media Ö Home Office savings Ö further reduce staff levels Ö focus on core activities Ö reduce initiatives wi
Slide 15: Tight Inventory Management
Tight Inventory Management Ö Realign inventory to lower sales Ö Improve distribution center efficiency Ö Enhance product recall systems Ö Clear slow moving lines more rapidly Ö Closed rough diamond initiative 15 15
Slide 16: Full Year Receivables Performance
Full Year Receivables Performance 10.0 15.0 9.0 8.0 12.0 7.0 6.0 9.0 5.0 4.0 6.0 3.0 2.0 3.0 Net bad 1.0 Average debt 0.0 0.0 monthly as % collection 9 19 /97 19 /98 19 /99 20 /00 20 /01 20 /02 20 /03 20 /04 20 /05 20 /06 ca 0 7 20 /08 /0 re 2 6/0 of credit 08 rate % 96 97 98 99 00 01 02 03 04 05 st
Slide 17: Reasons for In-house Credit
Reasons for In-house Credit Ö Important element of jewelry sales transaction Ö Credit risk hidden not eliminated by outsourcing Ö Factors under our control Ö score cards Ö collection strategies Ö customer service Ö Competitive sales advantage 17 17
Slide 18: Reduce Space Growth
Reduce Space Growth Kay Kay Off Mall Mall Regionals Jared Total Change Jan 2007 772 60 341 135 1,308 10% Opened 23 45 21 19 108 Closed (6) - (11) - (17) Jan 2008 789 105 351 154 1,399 11% † Opened 27 30 3 17 77 † Closed (21) (4) (50) - (75) Jan 2009 Expected 795 131 304 171 1,401 4% Openings (foreca
Slide 19: Kay
Kay Forecast 2003/04 2008/09 Sales (million) $1,080 c.$1,400 Stores at y.e. 717 926 Average sales per store (000) $1,528 c.$1,500 Ö Sales c.40% greater than No.2 brand in market Ö High brand name recognition driven by multi channel marketing using “Every kiss begins with Kay” Ö Every store has a qua
Slide 20: Jared
Jared Forecast 2003/04 2008/09 Sales (million) $323 c.$700 Stores at y.e. 79 171 Average sales per store (000) $4,573 c.$4,500 Ö No. 1 off-mall middle market jewelry chain Ö National network TV advertising commenced Christmas 2007 Ö National radio advertising commenced 2008/09 Ö At maturity store co
Slide 21: Profitable Market Share Opportunity
Profitable Market Share Opportunity Ö Long term industry growth Ö Fragmented sector Ö Rationalization taking place Ö independents withdrawing Ö financial pressures causing regional brands to close stores Ö increasing number of bankruptcies Ö Signet has superior retail execution, operating metrics an
Slide 22: Long Term Industry Growth
Long Term Industry Growth c.50% of world diamond sales (a) 70 60 .r. 5.6% 50 c.a.g $bn 40 30 20 10 0 81 83 85 87 89 91 93 95 97 99 01 03 05 07 19 19 19 19 19 19 19 19 19 19 20 20 20 20 US Jewelry and Watch Market (b) Sources: (a) IDEX (b) US Department of Commerce 22 22
Slide 23: Fewer Specialty Jewelry Firms
Fewer Specialty Jewelry Firms 35,000 -c.1.7% pa 30,000 Num ber of firm s 25,000 20,000 15,000 10,000 5,000 0 87 99 91 93 95 97 99 01 03 05 07 19 19 19 19 19 19 19 20 20 20 20 Source: Jewelers Board of Trade 23 23
Slide 24: Competitors Under Pressure
Competitors Under Pressure Sales $m No. of stores 2007 2002 2007 2002 Kaya 1,490 1,011 894 676 Zalesab 1,089 1,004 789 757 Jareda 756 259 154 67 Helzbergd 500 550 268 254 Fred Meyerde 465 475 400 442 Gordon’sab 329 321 282 298 Friedman’scd 300 674 Liquidated 2008 665 Bailey Banks & Biddleab 284 315
Slide 25: Industry Leading Performance
Industry Leading Performance Sales Operating EBIT/Total Growth Margin Assets (a) 5 year 5 year 5 year c.a.g.r. average average Signet US (b) 9.4% 12.0% 14.9% Zale Corp (c) (0.9)% 4.8% 8.2% Typical US Specialty 4.4% 5.5% 7.7% Jeweler (d) (a) Total assets excludes goodwill (b) To y.e. February 2, 2008
Slide 26: UK Jewelry
UK Jewelry “Making existing space work harder” 26 26
Slide 27: Financial Performance Fiscal 2009
Financial Performance Fiscal 2009 Ö Same store sales down 10.9% over Christmas Ö 3.5% same store sales decrease for 48 weeks Ö 4.2% total sterling sales decline for 48 weeks Ö Gross margin expected to be broadly similar to last year Ö Operating margin anticipated to be c.9% Ö Good cash flow generati
Slide 28: H.Samuel
H.Samuel Forecast 2003/04 2008/09 Sales (million) £281.4 c.£250 Stores at y.e. 407 351 Average sales per store (000) £699 c.£720 Average unit selling price £35 c.£48 Merchandise mix Gold jewelry 32% 30% Watches 24% 26% Diamond jewelry 17% 22% Gifts 18% 12% Ö No.1 in UK market, c.6.5% jewelry market
Slide 29: Customer Oriented Design
Customer Oriented Design Before After Liffey Valley 29 29
Slide 30: Ernest Jones
Ernest Jones Forecast 2003/04 2008/09 Sales (million) £207.1 c.£205 Stores at y.e. 197 206 Average sales per store (000) £1,083 c.£1,050 Average unit selling price £139 c.£200 Merchandise mix Gold jewelry 25% 25% Watches 32% 35% Diamond jewelry 34% 33% Ö No.2 in UK market, c.5.6% jewelry market shar
Slide 31: Benefits of Enhanced Design
Benefits of Enhanced Design Ö Increased differentiation Ö Enhanced utilization of store space Ö Expanded display of watches, with clearer branding Ö Improved diamond bridal sales area 31 31
Slide 32: Customer Oriented Format
Customer Oriented Format % of store numbers 41% 46% 47% 50% 52% 9% 15% 18% 22% 24% 29% 18% 16% 11% 9% 28% 22% 19% 15% 10% 2007/08 2008/09 Forecast Forecast Forecast 2009/10 2010/11 2011/12 EJ Traditional HS Traditional EJ Customer oriented HS Customer oriented 32 32
Slide 33: Priorities in Fiscal 2010
Priorities in Fiscal 2010 Ö Action to realign trading stance in extremely challenging marketplace Ö work with suppliers to minimize impact of input cost increases Ö maximize gross margin dollars in highly promotional environment Ö cut costs Ö reduce inventory Ö lower capital expenditure & selective
Slide 34: Industry Leading Performance
Industry Leading Performance Sales Operating EBIT/Total Growth Margin Assets (a) 5 year 5 year 5 year c.a.g.r. average average Signet UK (b) 0.5% (c) 12.7% 23.5% Typical UK Specialty 3.5% 6.9% 10.2% Jewelers (d) (a) Total assets excludes goodwill (b) To y.e. February 2, 2008 (c) At constant exchange
Slide 35: Regulation G
Regulation G JEWELERS
Slide 36: Christmas 2008/09 Sales
Christmas 2008/09 Sales The Group has historically used constant exchange rates to compare period-to-period changes in certain financial data. This is referred to as ‘at constant exchange rates’ throughout this presentation and constitutes a “non GAAP financial measure”. The Group considers this to
Slide 37: YTD 2008/09 Sales
YTD 2008/09 Sales The Group has historically used constant exchange rates to compare period-to-period changes in certain financial data. This is referred to as ‘at constant exchange rates’ throughout this presentation and constitutes a “non GAAP financial measure”. The Group considers this to be a u
Slide 38: Appendix
Appendix JEWELERS 38
Slide 39: Move to US Primary Listing
Move to US Primary Listing Ö Rationale for US primary listing Ö more familiar with business Ö better understanding of US economic environment Ö lower foreign exchange exposure Ö more appropriate peer group Ö Rationale for Bermuda domicile Ö minimise impact on shareholders Ö no adverse tax consequenc
Slide 40: Group 5 Year Record
Group 5 Year Record Page Group Comp. Performance 2 Group Financial Performance 3 Group Financial Performance 3 Capital Expenditure, Depreciation & Amortisation 4 Credit Facilities 4 40 40
Slide 41: Group Comp. Performance
Group Comp. Performance Group Comp. Sales 5.0 4.8 2.4 -0.7 -8.1 2004/05 2005/06 2006/07 2007/08 2008/09* US Comp. Sales UK Comp. Sales 3.0 7.1 1.2 2.0 5.9 6.2 -8.2 -3.5 -1.7 -9.5 2004/05 2005/06 2006/07 2007/08 2008/09* 2004/05 2005/06 2006/07 2007/08 2008/09* * 2008/09 are 48 weeks to January 3, 20
Slide 42: Group Financial Performance
Group Financial Performance Sales $m Operating Margin % 3,665.3 12.9 13.2 3,559.2 11.7 3,154.1 11.4 3,004.8 9.8 2,697.2 2003/04 2004/05 2005/06 2006/07* 2007/08 2003/04 2004/05 2005/06 2006/07* 2007/08 Income Before Tax, $m Earnings per share, cents 14.8 14.6 387.3 379.5 13.7 354.3 15.4 12.9 330.4 3
Slide 43: Group Financial Performance
Group Financial Performance (a) Dividend per share, cents ROCE % 26.1 26.2 22.3 22.4 7.2 7.3 5.6 5.9 17.3 4.2 2003/04 2004/05 2005/06 2006/07* 2007/08 2003/04 2004/05 2005/06 2006/07* 2007/08 Net Debt, $m Gearing % 21.2 374.6 233.2 13.9 174.5 11.6 10.9 11.5 145.3 157.9 2003/04 2004/05 2005/06 2006/0
Slide 44: Capital Expenditure, Depreciation & Amortisation
Capital Expenditure, Depreciation & Amortisation 2008/09 2004/05 2005/06 2006/07 2007/08 forecast $m $m $m $m $m Capital expenditure US 77.6 88.4 101.1 111.1 c.77.0 UK 53.5 48.2 23.3 29.3 c.38.0 Total 131.1 136.6 124.4 140.4 c.115.0 Depreciation and amortisation US 45.2 51.3 61.3 72.1 c.81.0 UK 32.4
Slide 45: Credit Facilities
Credit Facilities 2006 Private Placement (7, 10 & 12 year maturities) $380m 2008 Bank Facility Agreement (5 year) $520m 2008 Conduit (364 days) $100m $1,000m Fixed charge covenant 1.4x 2007/08 Gross debt $(416)m Cash $42m Net debt at February 2, 2008 $(374)m Fixed charge cover 1.8x 2008/09 Forecast
Slide 46: US Jewelry Division
US Jewelry Division Page Summary Financials 5 Merchandise Mix 6 Diamond Supply Chain 6 Test Before We Invest - Merchandise 7 Average Retail Price of Merchandise Sold 7 Average Sales Per Store 8 Jewelry Sector Performance 8 Growth in US Stores 9 In-house Credit Requirements 9 Receivables Profile 10 4
Slide 47: US Summary Financials
US Summary Financials 2003/04 2004/05 2005/06 2006/07 2007/08 Sales - $m 1,866.8 2,060.5 2,308.8 2,652.1 2,705.7 Comp. store sales growth 4.6% 5.9% 7.1% 6.2% (1.7)% Total sales growth 7.9% 10.4% 12.1% 14.9% 2.0% Operating income - $m 231.3 264.2 295.9 318.9 265.2 Operating 12.4% 12.8% 12.8% 12.0% 9.
Slide 48: US Merchandise Mix
US Merchandise Mix 2008/09 2004/05 2005/06 2006/07 2007/08 % % % % % Estimate Diamonds & diamond 72 72 74 75 75 jewelry Gold jewelry 8 8 7 7 7 Other jewelry 13 13 12 11 11 Watches 7 7 7 7 7 Total 100 100 100 100 100 Excluding repairs, warranties and other miscellaneous sales 48 48
Slide 49: US Diamond Supply Chain
US Diamond Supply Chain 75% of US merchandise mix Rough Polished Manufactured Retailers Mines T T r r a Cutters & a Sightholders d polishers d Manufacturers Wholesalers e e r r s s Contract Manufacture Complete Signet 49 49
Slide 50: Test Before We Invest
“Test Before We Invest” Leo Diamond LeVian Peerless & Hearts Desire 2000 Selected Jared stores Selected Jared stores 2001 All Jared & 300 malls All Jared & 50 malls 2002 All stores All Jared & 200 malls Styles expanded 2003 Additional cuts tested All Jared & 300 malls Tested LeVian galas 2004 Increa
Slide 51: Average Retail Price of Merchandise Sold ($)
Average Retail Price of Merchandise Sold ($) 2008/09 2004/05 2005/06 2006/07 2007/08 Estimate Kay 282 305 317 327 330 Regionals 304 324 332 343 345 Jared 644 697 719 747 715 51 51
Slide 52: Average Sales Per Store
Average Sales Per Store 2008/09 2004/05 2005/06 2006/07* 2007/08 Estimate Kay ($’000) 1,584 1,665 1,815 1,710 c.1,500 Jared ($’000) 4,975 5,453 5,676 5,341 c.4,500 Regionals ($’000) 1,533 1,514 1,517 1,344 c.1,150 Includes only stores operated for the full financial year * 53 week year 52 52
Slide 53: US Jewelry Sector Performance
US Jewelry Sector Performance 18% 15% 12% Growth p.a. 9% 6% 3% 0% -3% ) ) 98 99 02 03 04 05 06 07 (a (a 19 19 20 20 20 20 20 20 00 01 20 20 Furniture & Household excl. Electricals Electricals & Electronics Clothing Jewelry & Watches Signet US (a) Excludes Marks & Morgan acquisition Source: US Depart
Slide 54: Growth in US Stores
Growth in US Stores Kay & Jared* Total Space Cumulative space Regionals increase increase Jan 2000 799 28 827 +10% +10% Jan 2001 956 43 999 +26% +39% Jan 2002 970 55 1,025 +6% +47% Jan 2003 983 67 1,050 +6% +56% Jan 2004 1,024 79 1,103 +7% +67% Jan 2005 1,063 93 1,156 +8% +80% Jan 2006 1,111 110 1,2
Slide 55: In-house Credit Requirement
In-house Credit Requirement Ö High bridal participation c.45% Ö Characteristics of bridal customer Ö young Ö limited, if any, credit history Ö high level of financial commitments as setting up home, or Ö older customer making anniversary purchase Ö Young consumer not typical bank credit customer Ö r
Slide 56: US Receivables Profile
US Receivables Profile 2003/04 2004/05 2005/06 2006/07 2007/08 Average outstanding $729 $792 $841 $957 $997 balance Average monthly 14.8% 14.8% 14.5% 14.6% 13.9% collection rate Credit sales as % of 50.5% 51.2% 51.6% 51.7% 52.6% sales Net bad debt as % of 5.5% 5.5% 5.8% 5.3% 6.5% credit sales 56 56
Slide 57: US Jewelry Market
US Jewelry Market Page US Jewelry Market 11 Major Jewelry Retailers 11 Sales Per Store 12 57 57
Slide 58: US Jewelry Market
US Jewelry Market 2003 2006 2007 US Market size $53bn $63bn $65bn Chain Jewelers ($100m+ sales) 14% 15% 15% Independent Jewelers 36% 33% 33% Total specialty 50% 48% 48% Chain Department Stores 12% 12% 11% Mass Merchants 10% 10% 10% TV Home Shopping 4% 5% 5% Other (General, clothing & misc.) 20% 19%
Slide 59: Major Jewelry Retailers 2007
Major Jewelry Retailers 2007 General Retailers Sales $ bn Specialty Retailers Sales $ bn Wal-Mart 2.81 Signet US 2.7 QVC 1.51 Zale Corp US 2.02 JC Penney 1.01 Tiffany 1.52 Sears 0.91 Helzberg 0.51 Finlay 0.82 Fred Meyer 0.51 Macy’s East 0.51 Tourneau 0.41 Jewelry Television 0.51 Cartier 0.41 Costco
Slide 60: Sales Per Store
Sales Per Store Sales per store $'000 1,606 1,251 1,017 Kay/ Zales/ Industry3 Regionals 1 Gordons2 2007/08 1 y.e. February 2, 2008 2 y.e. July 31, 2008 3 y.e. December 31, 2007 60 60
Slide 61: Jared
Jared Page Jared Investment Model 13 Jared Performance 13 Jared Locations 14 Jared Off-mall Presence 14 Jared Development 15 Test Before We Invest 15 Regional Brands 16 61 61
Slide 62: Jared Investment Model
Jared Investment Model Ö Investment – c.$4.0m per store Ö First full year sales – c.$3.4m Ö Year 5 sales - $5m to $6m Ö At maturity, EBIT% similar to mall stores Ö 67 Jared stores over 5 years old Ö achieved average sales of c.$5.6m in year 5 Ö sales continue to grow beyond year 5 Ö store contributi
Slide 63: Jared Performance
Jared Performance Actual 2007/08 Average of 6+ years $6.4m s to re s a le s $ m A v e ra g e 1% 5 20% 18% 6% 3% 19 24 18 14 12 12 12 15 13 8 7 stores stores stores stores stores stores stores stores stores stores stores 0 ar ar ar ar ar ar ar ar r d s ea c te ye ye ye ye ye ye ar ye ye ty ye o je h
Slide 64: Jared Locations
Jared Locations Existing stores Opened in 2007/08 64 64
Slide 65: Growing Off-mall Presence
Growing Off-mall Presence % of Space Growth % of Total Space 24% 27% 29% 44% 32% 33% 35% 50% 59% 62% 78% 1% 66% 1% 2% 4% 6% 10% 10% 12% 38% 11% 15% 75% 72% 40% 69% 64% 29% 31% 61% 23% 22% 55% 18% -9% 4 5 6 7 8 s t 04 05 06 07 08 s t 03 /0 04 /0 05 /0 06 /0 07 /0 ca 0 3/ 0 4/ 0 5/ 0 6/ 0 7/ ca 20 20
Slide 66: Jared Development
Jared Development Ö 1993/94: 3 test stores opened Ö 1996 revised format opened in Denver Ö 1997: 3 further test stores opened Ö 1998: 8 stores opened Ö 1999 to 2004: 12-15 stores opened p.a. Ö 2005: 18 stores opened Ö 2006: 25 stores opened Ö 2007: 19 stores opened Ö 2008: 17 stores opened Ö 2009: 9
Slide 67: Test Before We Invest
“Test Before We Invest” Stage Jared Kay off-mall Kay outlet Test initial 1993 – 1998 2002-2005 2006 & 2007 concept 15 store test Test c.10 p.a. Test up to 5 p.a. Initial 1999 – 2004 2006 – 21 stores 2008 – Test 8 roll-out 12 to 15 stores p.a. 2007 – 40 stores 2008 – 18 stores Investment 2004: 28 sto
Slide 68: Regional Brands
Regional Brands 2002/03 2007/08 Sales (million) $461 $460 Stores at y.e. 307 351 Average sales per store (000) $1,536 $1,344 Ö New markets not meeting sales expectations Ö Limit openings to areas with marketing support Ö Review stores applying strict ROCE and return on marketing standard Ö Acquisiti
Slide 69: Real Estate
Real Estate Page Typical Mall Layout 17 In-Line v. Corner Location 17 Typical Power Strip 18 Typical Lifestyle Centre 18 69 69
Slide 70: Typical Mall Layout
Typical Mall Layout No. 1 Department Food entrance store court Dept Dept store store Best locations Good locations Department OK locations store Poor locations 70 70
Slide 71: In-Line v. Corner Location
In-Line v. Corner Location Mall Mall Mall Display cases 71 71
Slide 72: Typical Power Strip
Typical Power Strip od ng Us ble s & th Kay Sp cks uy Go orti Ba s R B No rne Di nd ys st d & MAJOR ROAD Ba yo Be Be To Be Kay * * t t an D an RE ur ur nk sta sta JA Ba Re Re MAJOR ROAD Specialty retailers * Note: Kay and Jared are unlikely to be sited in the same power strip mall 72 72
Slide 73: Typical Lifestyle Centre
Typical Lifestyle Centre m tr o ma ds ne r Ci No Pedestrian area Kay MAJOR ROAD & rnes ble No Ba Pedestrian Pedestrian area area MAJOR ROAD Specialty Restaurants Health & Beauty retailers 73 73
Slide 74: UK Jewelry
UK Jewelry Page UK Summary Financials 19 Comp. Store Sales Growth 20 Store Count 20 Average Sales per Store 21 Merchandise Mix (HS) 21 Merchandise Mix (EJ) 22 Average Retail Price 22 UK Retail Market Map 23 74 74
Slide 75: UK Summary Financials
UK Summary Financials 2003/04 2004/05 2005/06 2006/07 2007/08 Sales - £m 494.3 507.7 496.6 482.5 479.8 Comp. store sales growth 5.5% 3.0% (8.2)% 1.2% 2.0% Total sales growth 16.1% 13.7% (10.5)% 7.3% 5.8% Operating income - £m 75.7 78.5 49.3 53.2 54.7 Operating 15.3% 15.5% 10.5% 11.0% 11.4% margin RO
Slide 76: Comp. Store Sales Growth
Comp. Store Sales Growth H.Samuel Ernest Jones 4.5 1.9 0.7 1.3 2.9 -8.7 -2.8 1.7 -7.5 -4.2 2004/05 2005/06 2006/07 2007/08 2008/09* 2004/05 2005/06 2006/07 2007/08 2008/09* * 2008/09 are 48 weeks to January 3, 2009 76 76
Slide 77: UK Store Count
UK Store Count 2008/09 2004/05 2005/06 2006/07 2007/08 Estimate H.Samuel 398 386 375 359 351 Ernest Jones 204 207 206 204 206 Total 602 593 581 563 557 77 77
Slide 78: UK Average Sales per Store
UK Average Sales per Store 2008/09 2004/05 2005/06 2006/07* 2007/08 Estimate H.Samuel (£’000) 723 681 695 722 c.720 Ernest Jones (£’000) 1,150 1,065 1,079 1,105 c.1,050 Average sales per store excluding VAT. Includes only stores operated for the full financial year * 53 week year 78 78
Slide 79: UK Merchandise Mix
UK Merchandise Mix H.Samuel 2008/09 2004/05 2005/06 2006/07 2007/08 % % % % % Estimate Gold jewelry 32 32 31 31 30 Watches 24 24 24 25 26 Diamond jewelry 19 20 21 22 22 Other jewelry 9 9 10 10 10 Gifts and other 16 15 14 12 12 Total 100 100 100 100 100 79 79
Slide 80: UK Merchandise Mix
UK Merchandise Mix Ernest Jones 2008/09 2004/05 2005/06 2006/07 2007/08 % % % % % Estimate Gold jewelry 25 25 25 25 25 Watches 31 30 31 33 35 Diamond jewelry 36 36 35 34 33 Other jewelry 5 6 6 6 5 Gifts and other 3 3 3 2 2 Total 100 100 100 100 100 80 80
Slide 81: Average Retail Price of Merchandise Sold (£)
Average Retail Price of Merchandise Sold (£) 2008/09 2004/05 2005/06 2006/07 2007/08 Estimate H.Samuel 37 38 42 44 c.48 Ernest Jones 141 148 163 180 c.200 81 81
Slide 82: UK Retail Market Map
UK Retail Market Map (ex. independents) £250 Goldsmiths Fraser Hart HIGH Ernest Jones Estimated Average Beaverbrooks Transaction H.Samuel Value Argos LOW F. Hinds Asda Warren James £0 FEW MANY 82 Range of Products 82