Signet to Close 200+ Stores This Fiscal Year

Akron, Ohio--Signet Jewelers Ltd. is set to shutter 200-plus stores this year as part of a three-year turnaround plan announced Wednesday.

The introduction of the plan comes as the retailer continues to see sales slip but enters its first full fiscal year under the leadership of CEO Virginia Drosos, who started in August.

Signet’s same-store sales slid 5 percent in the fourth quarter and full year ended Feb. 3, with Kay Jewelers and Jared the Galleria of Jewelry stores accounting for much of the decline.

The company’s Sterling Jewelers division, which includes Kay, Jared and regional brands, posted a 9 percent drop in same-store sales in the fourth quarter and a 7 percent decline for the year.

The retailer pointed to ongoing issues with the outsourcing of its credit program as well as declining sales of Ever Us, the two-stone collection that was a bestseller when first introduced.

Zale Jewelry’s same-store sales rose 4 percent in the fourth quarter, driven by the new Enchanted Disney collection, line extensions to Vera Wang Love and an improved selection of solitaires and fancy-cut diamonds. For the year, same-store sales declined 2 percent, with strength in Disney and Vera Wang sales offset by weakness in bridal and beads.

During the company’s earnings call Wednesday morning, Drosos said the retailer is losing bridal sales to online competitors as well as to independent jewelers who are offering a “very personalized relationship” with customers, which is outweighing the competitive advantage Signet feels it has in selection.

Total sales for Signet, including its U.K. division, were $2.29 billion in the fourth quarter, up 1 percent year-over-year, and $6.25 billion for the year, down 2.4 percent. The total sales calculation includes an extra calendar week when compared with the previous fiscal year.

Drosos called the year “challenging.” The company expects comps to decline again this fiscal year, which she said will be a “transitional year” for the retailer as it implements its three-year turnaround plan.

The plan, termed the “Signet Path to Brilliance,” includes an evaluation of the company’s physical footprint, which Signet said it believes will result in the closure of more than 200 stores by the end of fiscal 2019. About three-quarters of the stores that will close are located in malls where Signet has already has another store. In addition, over the next three years, Signet will close all its regional brand stores.

Two hundred stores represents about 6 percent of