Signet Jewelers shares sink on weak outlook

A Kay Jewelers store is seen in Lincolnwood, Ill., Wednesday, March 14, 2018. Signet Jewelers Ltd. will close more than 200 stores and expects a profit slump in 2019 as it faces an increasingly tough market for its Kay and Jared stores. (AP Photo/Nam Y. Huh)
A Kay Jewelers store is seen in Lincolnwood, Ill., Wednesday, March 14, 2018. Signet Jewelers Ltd. will close more than 200 stores and expects a profit slump in 2019 as it faces an increasingly tough market for its Kay and Jared stores. (AP Photo/Nam Y. Huh)
Kay Jewelers store is seen in Lincolnwood, Ill., Wednesday, March 14, 2018. Signet Jewelers Ltd. will close more than 200 stores and expects a profit slump in 2019 as it faces an increasingly tough market for its Kay and Jared stores. (AP Photo/Nam Y. Huh)

NEW YORK — Signet Jewelers Ltd. will close more than 200 stores and expects a profit slump in 2019 as it faces an increasingly tough market for its Kay and Jared stores.

The company's strategic plan and weak outlook weighed down shares, despite a boost in fourth-quarter profit on a tax gain. Shares fell $9.23, or 19 percent, to $38.68 in afternoon trading.

The Hamilton, Bermuda company's profit during the quarter ended Feb. 3 rose 19.1 percent to $351.3 million, or $5.24 per share, as revenue rose 1 percent to $2.29 billion. Earnings, adjusted for pretax gains, were $4.28 per share, topping Wall Street expectations.

But same-store sales, a key measure of a retailer's health that excludes sales from recently opened or closed stores, fell 5.2 percent, mainly on sharp drops from Kay and Jared locations.

Looking ahead, the company is closing more than 200 stores of its more than 3,500 locations by the end of the year while boosting its e-commerce options. Signet does plan to open 35 to 40 stores, it added. The company will also continue to outsource its in-house credit card receivables.

Separately, Signet said it increased the size of its board to 12 members with the appointment of Sharon L. McCollam and Nancy A. Reardon. McCollam most recently worked as the chief financial officer of Best Buy, and Reardon is a former human resources and communications officer, having retired from Campbell Soup Co. in 2012.

For the year, the company reported profit of $519.3 million, or $7.44 per share. Revenue was reported as $6.25 billion.

It expects profit and revenue to fall in fiscal 2019, with full-year adjusted earnings in the range of $3.75 to $4.25 per share, and revenue in the range of $5.9 billion to $6.1 billion.

Signet shares have decreased 15 percent since the beginning of the year. The stock has dropped 30 percent in the last 12 months.

_____

Elements of this story were generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on SIG at https://www.zacks.com/ap/SIG

Similar News

Rugby couple put respect in front and center in Olympics

Aug 10, 2016

Isadora Cerullo has become a celebrity around Rio, more for what happened on the sidelines of the Olympic rugby stadium than for her performances on the pitch

Global oil demand to cool, oversupply is ending, agency says

Aug 11, 2016

Global demand for oil will grow less than previously expected next year due to a weaker economy, though the oversupply of the market is ending, the International Energy Agency said Thursday

Average US 30-year mortgage rate ticks up to 3.45 percent

Aug 11, 2016

Long-term U.S. mortgage rates edged higher this week, though rates remain at historically low levels. Mortgage giant Freddie Mac says the average for the benchmark 30-year fixed-rate mortgage ticked up to 3.45 percent from 3.43 percent last week.

Broaden