Jewellery sales down as shoppers stay away

Jewellery retailer Signet revealed today that its Ernest Jones and H Samuel chains had sunk deeper into the red.

Hit by the weakness in consumer confidence, Signet said first-quarter losses of £400,000 (€585,000) at the operating level had swollen to a deficit of £2.4 (€3.5m) at the half-year stage.

Chief executive Terry Burman said the situation was likely to remain difficult as the build-up begins to the key Christmas trading season.

At its estate of more than 200 Ernest Jones stores, Signet said like-for-like sales were 7.1% lower in the first half and the rate of decline was faster at H Samuel where sales dropped by 8.4%.

H Samuel operates in 12 towns and cities in Ireland.

Mr Burman did not believe trading was worse than rival retailers and claimed that Signet may be improving on its 17% share of the jewellery market.

Because the UK and Ireland account for only 30% of group sales, with the remainder being generated across the Atlantic where business has been brisk, Signet banked pre-tax profits of £52.1m (€76.2m) during the first half – up 4% on the same stage of 2004.

Diamonds account for 28% of all sales compared with 20% five years ago, he said.

This meant that the average price of jewellery sold in the first six months of this year rose by 4.6% at Ernest Jones and by 4% at its portfolio of more than 380 H Samuel stores.

Mr Burman said losses in the UK and Ireland were “small” and could have been worse had the company not kept a tight control of costs and stock.

“While others might be pulling resources away from their business, we are continuing to invest in training, improving our ranges, marketing and new store design,” he said.