Second-half sales across Michael Hill’s three core markets have ended the year in opposing ends, with Australia up 12 per cent, New Zealand down 12 per cent and Canada in the middle at 1.6 per cent.
Despite the mixed results, overall sales in the second half of FY24 have increased by 4.9 per cent to $278.6 million, with the percentage lift higher in the second half compared to full-year FY24, with full-year sales up 3.8 per cent to $641.4 million.
According to Michael Hill, the last seven weeks of FY24 showed positive momentum across all markets and channels, with group sales up 6 per cent, and the core Michael Hill brand in Australia and Canada both achieving positive sales growth compared with the prior comparable period.
While trading improved through May and June, the jewellery business confirmed there was also a deliberate focus on clearing inventory to make way for higher-margin product in FY25. Its gross margin settled at around 60.5 per cent for the year, with closing inventory levels better than management expectations.
All these sales results include Bevilles, which Michael Hill acquired in April 2023.
“While challenging economic conditions have persisted across all markets throughout the year, particularly in the fine jewellery segment, the group has continued to outperform the category, with a focus on retail fundamentals and execution of its clearly articulated strategies,” Michael Hill CEO and managing director Daniel Bracken said. “Particularly pleasing was the consistent performance of our Canadian business throughout the year.
“While FY24 was disappointing, and trading conditions are expected to remain challenging, initiatives are underway to drive sales and productivity, enhance margin, optimise inventory, prioritise and reduce capital expenditure to protect the balance sheet and further embed cost-conscious discipline across the business.
“As a key milestone of the Michael Hill brand elevation journey, April saw the unveiling of our first global flagship store at Chadstone in Melbourne showcasing the new brand codes, our first brand ambassador, Miranda Kerr, and a complete re-platforming of our website.”
Alongside the revenue lift for FY24, Michael Hill anticipates a full-year comparable profit of between $14 million to $16 million.
The group also reported a that its digital sales have returned to double-digit growth on the prior year, with its existing debt facility increasing by $40 million for the four month period from September 15, 2024 to support seasonal working capital requirements for Christmas trade. The FY24 year-end net debt position closed at around $40 million.
Australia is Michael Hill’s largest segment, at 171 stores - including 36 Bevilles stores - and this is followed by Canada at 85 stores, with New Zealand at 44 stores. The total score count is 300 exactly at year-end.