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Diamond days: Michael Hill dodges lockdowns, tips bumper profit

Business

Jeweller Michael Hill International is still booming despite lockdowns that shuttered stores on southern states for up to five weeks.

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In its trading update today, Michael Hill said it expected first half earnings before interest and tax of up to $53 million, an 18 per cent increase on the same time last year.

In its three affected markets of Australia, New Zealand and Canada, Michael Hill lost more than 230o store trading days because of lockdowns, but it has been able to segue to online.

The online division was behind the increase in sales and margin and has grown to 8 per cent of all sales, up from 6 per cent the previous year.

Same store sales were up almost 10 per cent and margin expansion was up between 200 and 300 basis points against the previous year’s second quarter.

Managing director Daniel Bracken said planning and execution was behind a strong Christmas trading period which was backed by a “highly emotive marketing campaign”.

“I’m particularly pleased with the result we have delivered considering the significant store closures due to Delta across NSW, Victoria and Auckland during October and early November,” Bracken said.

“And as we now enter 2022, the new Omicron variant is bringing new challenges across our Australian and Canadian network, both in terms of impacts on our team members and consumer confidence and behaviours.”

Michael Hill has now produced 10 consecutive quarters of same store growth.

 

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