Jewellery group Michael Hill International has managed to hold its gross margin relatively steady despite the impacts of continued aggressive promotional trading conditions and record high gold prices.
The jewellery group, which also manages Bevilles and Medley, expects its gross margin to be around 60.5 per cent for FY25, similar to its 60.6 per cent result for FY24.
According to the group, it offset the challenges by introducing and mix of higher margin products.
“Despite retail trading conditions remaining challenging in all markets, the business has delivered full-year earnings and gross margin broadly in line with prior year,” Michael Hill group interim CEO Andrew Lowe said.
“A relentless focus on store productivity saw a second-half lift in group same-store sales of 2.4 per cent. Our Canadian segment yet again delivered record sales, which is a credit to the resilience of the business and our team. New product initiatives, including our ‘Pendant Bar’ range and expanded ‘LAB.’ collection are resonating with both existing and new customers.”
The company also expects earnings before interest and tax to be around the FY24 result of $15.9 million.
The group’s Australian market recorded a 2 per cent lift in same-store sales to $150.1 million in the second half of FY25, with Canada growing the most at 6.5 per cent.
Michael Hill’s New Zealand segment was down 2.4 per cent in same-store sales for the second half, which is an improvement on its full-year result, which was down 5.5 per cent.
Full-year total sales for the group are very similar to FY24, with same-store sales up slightly by 0.3 per cent.
During the year, 14 Michael Hill branded stores were permanently closed in FY25, with two Australian stores converted to Bevilles, and two new stores opened.
The year finished with 250 Michael Hill stores, including 123 in Australia, 82 in Canada, and 45 in New Zealand.
For Bevilles, in addition to the two converted Michael Hill stores, one store closed, taking the network to 37. The Group finished the year with 287 stores, down from 300 at FY24 end.