The Watches of Switzerland (WOS) Group announced in its quarterly financial report for the August to October period that it had acquired 19 Ernest Jones stores from Signet Jewelers, but no details of the transaction were provided at the time.
In its latest quarterly report, Signet Jewelers has shared additional details, confirming that the business completed selling 15 stores under the Ernest Jones banner to the WOS Group – as opposed to the previously reported 19.
There is further potential for Signet to sell an additional six retail locations to WOS Group by the end of Q4 2023.
The accretive sale multiple from the 15 stores generated proceeds of approximately $53 million (£42m), the company discloses.
Signet expects an additional $25 million (£20m) of revenue from the transaction in Q4.
While the total revenue accrued from the completed and potential sales of Signet’s Ernest Jones stores could reach $75 million (£62m), this will fail to offset the company’s $190.8 million (£151.4m) decrease in sales for Q3.
There is a slight discrepancy between the reporting of the transaction by both parties, most likely due to phasing of completed transfers.
WOS reported buying 14 multibrand showrooms and five monobrand boutiques in its report for the quarter ending 30 October.
Signet describes the sold stores as “the divestiture of a non-strategic business,” which allows Signet to apply key elements of its UK transformation plan more quickly
The details emerged within Signet Jewelers’ Q3 report, which indicated that same store sales for H Samuel and Ernest Jones were down by 4.6% year-on-year, totalling $94 million (£75m).
Turnover dropped more sharply in the US, with same store sales down by 12.3% to $1.3 billion (£1b).
The group is forecasting full year sales of $7.07 billion (£5.62b) to $7.27 billion (£5.78b) despite headwinds in the engagement market.
Bridal overall, inclusive of engagements, historically represents nearly 50% of Signet’s merchandise sales.
