Yahoo Finance Signet CEO explains the 'transformation journey' that boosted jewel giant's Q3 earnings
Signet Jewelers (SIG)— the parent company of Kay Jewelers, Jared and Zales — shined after reporting strong third quarter earnings on Thursday that beat expectations.
The jewelry giant’s stock surged by over 7% after it reported a smaller than expected adjusted loss per share of $0.76 on revenue of $1.19 billion in Q3 — and boosted annual guidance above even the most optimistic of analysts’ expectations.
With Signet same store sales up 2.1% this quarter, CEO Virginia “Gina” Drosos told Yahoo Finance the company’s “transformation journey” is starting to pay off.
“We've put a number of initiatives in place that are really beginning to take hold,” Drosos told YFi PM.
“Starting with customer first, much better product marketing, and a transformed media plan for this holiday season, better omni channel, iPads in the hands of every jewelry consultant, and better websites,” Drosos said. “And we're driving out costs in the business that we've been able to reinvest to drive growth.”
Kay Jewelers lead Signet’s overall growth with a 3.8% boost in the third quarter. Meanwhile, Zales trailed behind one whole percent, and Jared found itself in the negative, down 2.9%.
As Signet looks to bring up its numbers up across its brands, Drosos says it’s important to recognize the difference in its customers.
“We know that we have different customers who are interested in our different brand banners, and we differentiate them that way,” Drosos explained.
“Our Zales customer is a very style oriented customer. Vera Wang does very well there, [and so does] Disney,” she said. “Kay is very much for sentimental gifters, and so we have some very romantic gifts and great opportunities for that over the holiday season. So they're different.”
And despite fears about the economy heading into 2020 — and whether consumers will continue to spend — Drosos declared that Signet feels good about the status quo.
“In the jewelry category, the consumer market is healthy,” Drosos continued. “We've seen over the last number of years low single digit growth in the category, and we expect that to continue. So I think all of that bodes well,” she said, adding that the bridal market was a particular interest.
And as the demographic for fine jewelry shifts, Signet is looking to ensure that its marketing and products are responsive to the change.
“We expect that 40% of the people who get engaged over the coming years will be Hispanic or LGBTQ+,” Drosos stated.
“We really have transformed our marketing and our product offering to make sure that we are very relevant to all consumers who want to express their love,” she added.
Chelsea Lombardo is a production assistant for Yahoo Finance. You can find more of her work here.
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