Signet Jewelers Limited (SIG) 20 Mar 242024 Q4 Earnings call transcript

Good morning, and welcome to the Signet Jewelers Fourth Quarter Fiscal 2024 Earnings Call. [Operator Instructions] Please note, this event is being recorded.Joining us on the call today are: Rob Ballew, Senior Vice President of Investor Relations; Gina Drosos, Chief Executive Officer; and Joan Hilson, Chief Financial, Strategy and Services Officer. At this time, I would like to turn this conference over to Mr. Rob Ballew, Senior Vice President of Investor Relations. Please go ahead, sir.

morning. Good Jewelers we Fiscal statements. will Signet Call.During Earnings Quarter discussion, today's make Fourth to XXXX and Conference Welcome certain forward-looking statements uncertainties. historical number not that subject Any a to facts of are and risks are Actual results materially. may differ urge reports language other cautionary on on XX-K, Form disclosures risk Form on report and quarterly annual X-K. to reports the our XX-Q We you Form factors, read in and current new statements information non-GAAP obligation required future to undertake revise in by light update publicly financial as call, of Except the no forward-looking or certain events.During we law, or discuss we will measures.

our the financial should at the investors most turn I'll of discussions further over ir.signetjewelers.com.With reconciliations to comparable as directly as review of the For Gina. that, financial the website measures call non-GAAP on the measures news measures, well to release GAAP non-GAAP posted we

Thank joining and for all us of today. you, you thanks Rob, to

on to an year engagement I'd an Before environment Signet team. we 'XX fiscal industry trough discuss expectations, delivered expectations jewelry the both for and promotional our thank drove deep that COVID-induced our results overstocked experienced a 'XX our in like elevated and fiscal category. They that a

inspire to work dedication you you year.I'd for me. all and leave takeaways your with like hard to today. key Thank this X continue You

First, of our EPS our we with financial high-end delivered on above guidance the commitments quarter this range.

nearly we Second, excluding is nonrecurring our over of $XXX generated year row, in legacy the million cash a for legal This XX% settlements market in free flow. fourth cap.

of quarter, X% this year. quarter's gains expect takeaways with of I'll delivered each fiscal last 'XX sales elaborate these we year as the Third, sales velocity. to $X.X engagement down recovery to same-store throughout this improve beginning roughly billion results.We on

with to value-conscious holding our shopper value like to point for with strategy to lab-created through provide the saw shop engineering an and this to trade-up As weekend within basis we ago. gifts. have saw and holiday new categories late get anticipated, items year in sell one along options leveraged resonated We innovation consumers products, increase extra a branding, our customers were a a as customers, competitive best deals our newness out at size XXX value as impressive proposition, we

this their Our strategy, year deep in we lab-created value time declines in gross independent expanded their American margin our as average accelerated held and nearly resulted for North fourth AUR independents. effective worked the heavy last quarter all flat, transaction also points diamonds basis This stepped by industry was data year.Conversely, diamonds and natural among jewelers suggests discounting modestly. which non-GAAP to up in discounts XXX

to be Our the life year. XX% product cycle to down inventory driving management strength, continues prior a of compared source levels

saw markdowns also new from relevant moving quarter, outperformed. retailers most we 'XX, U.S. allows nearly flat. margins. the same-store items value-oriented products jewelry to in Continuing bring for higher the we slower As Likewise, trend faster, the fiscal Banter, us of delivered strongest in this the catered sales that earlier, category to have Fashion Fashion which banner take this low-priced our

conversion into both U.K., Canada weeks our the strong with banners production continued Peoples stronger sales in lower H.Samuel reducing by X resulting of last from in Nile fulfillment, digital the partners, the caused American and North sales the which the by This over positive resulting rates integration Blue value X our holidays.Offsetting performances our have quarter, We overall lower in also in operational we which of fiscal of 'XX. banner issues saw in at at challenges core, delivered integration point. the had same-store and was same-store performance in

later year. expect and have We this implemented to are working to resolve these issues fixes

discipline. as jewelry our driven items we expanded lower category watch is market 'XX the designed the as Ernest the strength 'XX challenges points, more fueled by penetration. cost merchandise as stores.We that as fiscal our market our halo sourcing basis we is by the approximately to shift macro well flexible mix which takeaway as prior and impact continued cash, well where XX% estimate our underperformed lower-priced today Jones Bridal from nearly luxury also We less banner our market the with have modestly negative in a sale relative second with share from engagements year, believe in generating approximately in is over-indexed U.K., efforts in X%, where down We part U.S. the working was from we XX of by fiscal in significant share for for November share.The that and operating industry inventory savings, self-purchase model

a to led of we We authorization, of years.This returned than to Last total believe invest million year, in to for efficiencies return and $XXX the share which to to XX% in allows nearly use outstanding last we our to approximately availability operating is a ability capital remaining drive announced continue flow to bringing This LGP working free over to income. We conversion million. shareholders capital attractive our shareholders. cash we shares. our to will have capital the increase newness our of shareholders. This cash us million very $X buybacks in $XXX critical $XXX and morning, a market shareholders, We business, the free business, the to higher returned significant billion remain believe conversion X share preferred value continue. bringing our repurchase nearly our non-GAAP drive growth

billion. our even flow We our also that free powder liquidity, XX% XX% our strengthened November, goals. unsecured mature billion flow of our gives both strong also in in We with well $X.X fiscal handle in us while increase as than our the increase as fiscal year staying the preferreds this free our convertible that ended $X.X within cash mature sheet. million total which billion dry This to our balance in liquidity less common which represents announced $X cash above $X.XX target to our $XXX 'XX.Our quarter, in of a after this growing notes consecutive 'XX dividend is third dividend, June well

diluted preferreds 'XX the represent approximately which also and convertible upside reminder, potential As EPS common our provides guidance XX% of goals. a our fiscal midterm to shares,

build year's customization of customers of February.Our and a the We includes active sequential half knowledge, 'XX, We and in a have tenured February, material be with After we have are around in in improvement to notable the engagement January the full sales engagement customer's component preferred March. attract consistent we that marketing October engagement quarter. and dating February the this saw number impact we services in same-store a improvement we The more more our build third and and in to that customers. consistent million utilizing industry newness and customer shares plan to year We engagements back discussions for well on there growth range and new see XX to unit takeaway providing known One with points that milestone continue half capabilities fiscal in is of Signet customers, options. the scale retire has show their to look best we XX%. milestones saw the and customers. further data keep Board continue as including of as will XXX believe customers as in win of collection And deceleration education early as experienced will we'll to to This year, that relationships personalized increase brands, the the that occasions equity, the jewelry between use our return this personalized LGP its of will believe track opportunity provide as best.We after engagements couples than progress.The engagements ring is should to a basis early platform discussions way since will in engagement U.S. anniversaries and brand believe attract now XX majority Signet the these sale, provides fiscal to and X% looking through of throughout a milestones shape data give be increased we birthdays, updates in engagement known the plan 'XX. is this U.S. targeted marketing. the protected the sales clear lifelong expectations relationships, second also of to fourth new XXXX.We the

early In we recently, fact, are driving lift marketing and more among results XX-day a versus than tested XX% revenue customers, Kay sprints group. of personalized control a

we invest to shopping hometown Over through got to 'XX, years, market through strategically customers improve the ourselves last returns, see X and to where in renovations. get a stores strategy will great set we to experience within for we In our markets optimization Kay, the bigger. for up including grow our smaller fiscal fleet

than with offer services and offerings. insurance stores XX% XXX value XX% up opening our fiscal these points scale strong remains independents renovating doors. key service where fourth and stores to highest through returns growth BXB We the drive X,XXX are our in relevance to more seen new exceptional basis to which in additional to a in brand 'XX. by productivity for of investments services early XX order an of merchandise between area expand quarter outperformed We've breadth and from IRR.Services, further We companies, we look given of

a We buy at repairs who ESA piece to are an post-repair on not Agreement or customers drive initially will purchased or also did ESA Extended Signet. Service offerings seeking not

opportunity the increase further in for comment we 'XX, attachment results to Christmas, fiscal points both far so rates basis XXX 'XX. and late nearly motivated. were on 'XX, improve online.Now our Day highly Similar to in-store Valentine's to see shoppers value fiscal in continue I'll briefly and Following fiscal

early consumers and I'd a business digits. with ability high trend comps in and on X digital they operational dragging focused have early newness trade-offs down. to innovation outperform notably with be their takeaways. important mid-teens. will this banners summarize As as my same-store trends like The budgets today, bring February and single believe to comments a sales down was soft, will to Since issues key to make differentiator.To mid- We sales with result, February, year value our remain reiterate down January core improved continues our quite comp

again on commitments non-GAAP our this quarter, our above including delivered we high guide. EPS First,

we cash Second, $XXX for the flow over free in pro generated forma in year million a row. fourth

the And core same-store third, cash banners, capital to customer using now while to balance the strengthened new drive fiscal recovery; with is flywheel improve maintaining over conversion, we the back our turning sales through will acquisition, believe Our business newness; and product equities; call driving in discipline.I'll engagement improvement to positive brand see our growth. operating in return by: free same-store we're turn half during 'XX invest cost sheet of we driven year to and Joan. all which sales shareholders, strong our model

Same-store year. everyone. good for prior morning, third but $X.X billion, the sales the X% was down categories. reflects at Bridal quarter and X.X%, expectations were to This to Gina, Fashion compared quarter. our acceleration Thanks, Revenue improved in within and down the

While issues our January in expectations, driven December below by quarter, our digital best was same-store banners. in of was performance sales part somewhat integration the

Our digital our expectations, overall with the engagements engagement performance points third compared hundred to several improved were incidence quarter, of and line our in basis excluding banners.

last to is to in which ATV XX for flat the and This the a were deep jewelers declines included in ATV independent to and The notable, performance quarter total down roughly between largely decline.Our difference transactions and sales due week, quarter relatively generated was declined AUR sales points more $XXX America same-store year for discounting. the in their basis sales significant million XXrd X%. North compared

assortment points delivered the during gross customers up last ] implemented increased value quarter margin newly sales, over newness SG&A. LCD points also a margins [ trade-up grew jewelry our Merchandise grew by point-of-sale the like provided reflecting and in with of billion innovation an margin to and to attachment for nearly by non-GAAP increased strategy, through as $X.X quarter points, AUR basis prior basis non-GAAP stable this mix year. on offerings services by basis to our year, consultants.We basis, XX% an merchandise.Turning led XXX well engineering. several was to gross and with or of X% which rate XXX post-repair driven by by that as XXX options prompting ESAs Services Our our driven

Our deleveraged non-GAAP sales, XX.X% expense basis fixed of of against points reflects we higher XX costs. $XXX year as than somewhat million last

to this expectations. cost of meaningful high-end reflects with However, improvement our quarters the near savings prior

tax quarter was income the for more delivering revenue. quarter year per prior XX.X% diluted lower sales, from higher EPS prior operating was $X million a XX% up $XXX non-GAAP Non-GAAP the effective Our the on the than for $X.XX of lower net or year rate. higher interest on and operating income million income, share,

a sales, than in a is a SG&A for margin year up a was year from fiscal of due sales on earnings of XXX of For of a our sales. and of of $X.X million costs delivered by points $X.X more up the resulted non-GAAP XX sales the fixed 'XX above EPS cost year, operating lower with was with offset XX.X% base.Non-GAAP partially reflecting the basis diluted largely XX.X% in full of XX% to year, decline Non-GAAP increase we the billion Reflecting share, or the sales basis per $XXX This billion fixed same-store merchandise $XX.XX gross $X.X in basis. margin for expectations. deleveraging to of billion portion or income non-GAAP last high-end on points, labor.

fiscal legislation, increase in is new a increase which the nearly Bermuda, memo benefit next $X.X means inventory impact QX. This provides rate cash positively of resulted offsetting our tax effective on excluding rate be it was impacted from the was businesses. a more in minimum impact This our new on cash $XXX of taxes down tax benefit year to effective which recognition asset in $X.XX year. the million ending and will legislation 'XX million including more sales a XX%, of prior our or will $XXX the Bermuda from over an core effective pre-pandemic, of per in tax and to year-over-year X%. $XXX or reduction our tax rate.Our tax million larger years year, nonrecurring by GAAP now, $XX in also share than deferred a roughly or million of to billion inventory, acquisitions; a in below Due billion Our beginning rate tax was expected $X down EPS down compared owed XX% well our $XX.XX overall a than than this to income to XX

not continue order management, on markdowns our clearance. more meet focus expectations, SKUs to before cycle does We turn life earlier in when capture reach taking margin merchandise performance to

leverage. approximately in into of outstanding EBITDA Gross turns We and inventory, lean continue to year We X.Xx, adjusted to of with the million line debt assortments negative our efficiencies opportunity of was cash ended to optimizing $X.X AI to our translate in level. prior cash to billion with adjusted as debt net with to of year.Turning we exceeded directly store $XXX flow X.Xx the drive higher EBITDA inventory the debt. X.Xx see as margins. These particularly at

efficiencies. We by continue cash in confidence generate to to operating grow our free and flexible our ability flow each continued driven model year,

As which fiscal unsecured mature adjusted November. would X.Xx or are and debt the shares ahead EBITDA our adjusted introducing we the in of to target and our at end we look our EBITDA are notes or forward at X.XX in down X.XXx, into convertible of debt-to-adjusted X.Xx. imply preferred turns us, the be below target leverage This EBITDA year, June below by net mature below 'XX. maturities we And gross debt to at of to a year reducing

closed XXX stores 'XX. of locations stores. the sheet more year locations, banners across mall X,XXX and than us estate. would address cash debt to allow liquidity year, to and roughly we real performing down issuances in strong further comprised maturities We fiscal these full, XXX locations Our and fortress Last and done lower be conversion mostly balance U.K. with opportunistically.Turning from our ended

XX the including the investments X stores Jared plan Direct subsequent watch customer business, including In X an locations, XX store total, reflects strong and well in XXX count in February.Based remodeled increase experience. locations, end the up-tiering prestige November to our year, approximately higher-margin we we multiple also stores, capital expect to renovating continue the million as fleet. new enhance our and Diamonds the $XXX on U.K., to Kay and new $XXX Direct stores, seen that XX in core to XX Kay our approximately focus additional stores including X and new on in we've Diamonds million to XXX sale performances of in in to accretive locations this for stores, expenditures Jared, our as transaction, Our locations jewelry

We to team $XX also member $XX in of our and to digital in technology guidance. experiences.Turning million invest and expect million support to consumers

Looking and with $X.XX range to banner billion, we the impact XX% in first earlier. to down X-point X%, sales of including billion the total digital negative same-store quarter, $X.XX between our expect sales issues mentioned a from

same-store have a popular as As request, XX-week a fiscal a down Valentine's Since result returning and Day, of Valentine's to sales sales, January and shopping mid-teens, optimization modest luxury generally performance. watch investor consistent are we guidance.Early Day reintroducing sales was same-store with points store year mid-single fleet point and of banners. fourth number a improved We year. notably to digital excluding first will down quarter in the engagements the be of the further low- the quarter our to in when that digits X up U.S. X to forecast the

income operating non-GAAP and $XX expect We $XX between million. million

introducing also million EBITDA we upon EBITDA are million. year to quarter, expect first In adjusted guidance the $XX from $XXX investors. request between adjusted this We

in first SG&A the We $X.XX expect gross of billion billion. the sales.For expect fiscal range on flat-to-modest improvement the we while deleveraging same-store 'XX total in to margins sales in lower year, quarter, $X.XX in

the to by to our channels Nile tied core We core X% half our negative our same-store to, X.X% not Allen drag not range the performing the are integration, such of our second and digital of including nor midpoint are on variety solely for environment, resolve believe with to in price expect fiscal continue inflation in an our in the years X.X% new approximately reflected and our last year, sales impacted in the will Consumers impacting We points to focus year, the banners, elevated same-store the the as the to items is consumers will expect X current at demographics. believe banners the a are outperform focused James 'XX. issues continue be the it and we banners related Ernest but be flat X.X% of they across which Blue banners U.K. Jones down to e-commerce well.We from over in to for sales this and negative of in guidance. up to banner on a the halo X.X% value consumers that a year, impact continue appeal of will from approximately These digital issues are

jewelers We also independent promotions anticipate among continued elevated year. this

We expect in X% for to 'XX. engagement activity be to XX% U.S. fiscal the up

sales we our year same-store the to improve such, expect As as progresses.

Our a QX and X-year guidance range same-store assumes stack in the fairly similar sales year. full for

new Jones net our slightly. expect store to we also our and The total are XXrd over is week a cycling-off square in footage and locations. closures Ernest selling openings, the watch in efforts was $XX $XXX to million locations, rightsize and closing shift XX locations the from of closures flat Ernest be of from XX sales other overall that FY 'XX and We U.K. decline digital the banner up to to that part $XX 'XX.Net fiscal of another locations million, U.K. in to Jones or million and prestige

million, benefit cost We expected the turn. year This margin initiative 'XX margins in a addition half operating streamlining the savings see increasing of income of the reflects U.K. are expect to drive non-GAAP to savings efficiency.We inventory the AI, line million operating we million in years. leveraging EBITDA savings million to the more is to also sourcing non-GAAP to be to noncustomer-facing X-year $XXX Fiscal $XXX achieve with cost streamlining of out modest new our adjusted in X $XXX overhead within million sourcing as of rest $XXX impactful in to year $XXX with $XXX million, from the in costs with from range the be expansion. between $XXX and expenses in expect and of this system, the second million to company

member of margin is offset Full We channels of incentive $X.XX to customer expect in the by gross diluted experiences, year in EPS expected non-GAAP modest range deleverage e-commerce expansion. reset and in investments to $XX.XX. SG&A the and and team be from compensation

fiscal the of year. assumes estimates EPS for preferred dilution the year shares the for our the Importantly, entire

I thank new an our passion our and consumer-inspired resolved experience dedication our my their to to industry. comments in talented As ongoing today, their I innovation want and team close members, in millions of for loyal Signet customers unrivaled

Net stores.I'll our questions. Our Scores, why have online Promoter team excellent for is it in now both and we open up

from first [Operator Lejuez from of the Instructions] question line Your Paul comes Citigroup.

on Brandon your what seeing to on Paul. you're wanted forecast. update I for engagement on in to Cheatham side the dig

for was increase Now, you're what versus looking increase XX% for a I X% previously. the to XX% year think

Just an the up And us you progression can XQ? continues? higher Does XX% get XQ walk end to acceleration that in year does through wondering, assume there? as the than

questions. your for thanks Brandon,

happen and we you'll X and in over expected a incremental we're next seeing saw the in improvement trough would. they engagements as we're years. So We the as recover QX, engagement gradual trends expecting, recall,

it milestones a We've track. to also recover. to bit So progress we that XX on continued see takes the

much statistically proprietary have certain XX, We statistically, we've the us significant that engaged, being significantly of XXX that a once points up a versus data number in year and basis to they're that likely, a just experienced likely; has identified, milestones and that's get and fact, couple ago. number more shows that

that strengthen for side side be tend as will gradual the of fiscal More XX% And think So on October frame. well as as high of the guide, to both to the the our couples that on get we with back-weighted. X% February to the time has recovery to engagements low the seasonality engagements. naturally guide year, of do fiscal year our in it's 'XX engaged expect but progresses.We

likely be more back-weighted. So will it

you did end? And pressure And the pressure you was Fashion? on that or and in segment, weren't February, there is you I Bridal are any the ticket see those quantify of metrics incremental where transactions particular particularly saw, now? it. expecting you wondering, and Got high first half in the could that And

was discounting executed that despite we in all how back So on from in the I average things maintaining a jewelers, quarter value, that don't and to the and we go was fourth lab-created, especially proud if quantify were Fashion. independent in we Bridal significant tickets. team But transaction our QX stable the of think of one

average some because but to able newness, put which Those through did exceptional hold. newness value on well value, independent deep we provide transaction sold so were of and so that to discounting value, trends first what I rest have in quarter, we would low the early-February similar retail. think I and And the time saw to jewelry say. in It and pretty traffic a challenged of much much engineer an a continued So that we category pretty January pressure consumer. into we the was brought was

question Lorraine comes line from Bank next of Your the of Hutchinson America. from

wanted the follow-up on just I engagement discussion. to

with been You engagement did the And then, talk some expectations consistent in that quarter. in coming for your how fourth about landscape expectations? versus unit guidance year? this has for sales there in the pricing included softness competitive Was

seen So that number have to talk of consistently And Brandon, recovering pressure on is particularly we're that, both about couples we and units like the my to value, reason Lorraine, about because very independent transaction the we discounting driven the Fashion, said, average jewelers. getting in what reason thought. engaged. deep to answer has Similar -- some thinking in I by been we Bridal among

the You'll we remember, as well engagement they trough did. as didn't predict

working fourth quarter, the we're inventory so, over-inventoried a lot still moving pressure were of on through that so through. that all in And and year.They

I first falling. diamond also think continued that somewhat, are becoming have recovering that quarter, into I aware think consumers while the their that I are prices the are a could that we inventories anticipate seen help. lab-created and more be would discounting that, so

for and be might about while a jewelry, something they individual And rare Fashion great very, diamond. natural there's so very

for we And so that, year think a potential in natural diamonds ahead. is tailwind that the

expectations on us And year? that insights And business? the competitive on this of your are then, give non-Bridal can you your for talk landscape some -- what the

Sure.

part low-priced the overall the category of So has is best been performing jewelry. the that Fashion

and gold, Fashion So But Banter, some we low-priced and reasonably trade factories a value sourcing for jewelry, engineer in the space, partnerships U.K. newness in points we strategy have exposure positioned competes into banner that we proved up over advantages carry space. holidays.And into with price direct overall, we the lab-created value to we over The particular, is jewelry. also that the really low opportunity, think that to be our where well our to an in bringing to have Fashion good holidays. competes was have place us do H.Samuel where in uniquely customers very

holiday point We items improvement have pursuing basis that a through in by our how new strategy. over XXX sold

I the shoots we that, idea Bridal our in of offerings. on in the add to saw that holiday, would newness just and on and new green particularly Fashion

saw the Our the guidance is testing that of included selling higher intention that rate and run for FY given the and Lorraine. on newness, a 'XX within complement based we've we in holiday period,

Your next question Ike of comes from Boruchow from Fargo. Wells the line

kind us impressive. of I sustain first for maybe the of Joan, line, couple pieces A how through all, moving quarter? on kind just commented questions, the the able to you're on gross margin the on you headwinds in of -- that? well, think it gross that slightly you walk embedded of -- first pretty Can that's of And to comp, be negative up in kind XQ,

question, Thanks Yes. for Ike. the

team been able work to sourcing with our work in and the first our equation continues that savings efficiencies provide. with sourcing we've what's vendors our with margin to important really sourcing quarter is and newness. So the And

see we so, related throughout we'll the year, bringing newness part largely newness are as improvement the And that the more of happen of expect program because coming back-half in more the the I as and weighted back-half. be more incremental margin just the that to turn, cost And our will and will we year in savings newness throughout mentioned.

a sourcing big is disciplined opportunity.I So management. would also say inventory our

nimble trends. our job to synchronizing and amazing have and teams being inventory of Our an done demand position

in are not sell over-inventoried, not clearance or we a -- particularly are are we where in so And position down. we

product And clearance. able a earlier so manage leaner mark we're goes to before to

seeing while to face would say within we're that is promotional our been able we I in management the industry, the within base. key we've also So areas inventory component.And then product another pricing discounting target specific

it's have. that posture So we're or promotional not a broad-based not we discounting --

an as to for that gross those QX opportunity So in using the fiscal levers as are as continue well we're margin to drive 'XX. us

then, weighted. move margin? margins expect year-over-year margin Joan, Is as the you you more be into back had also XH to improve that saying you could operating that improvement And gross just you mentioned half? Are

on Goes margin. it sourcing or as new last will The will Yes, turn more back and X.Xx comes our gross margin occur inventory, largely in newness was items. year roll we savings and half the sourcing sell-through improve. the

Got then with gross to margin. it. the just And stick

services you just is I assume I [ year Can is plan us outgrow but ] like can down that your your number, planning? X. to share us the think with there number you're that high tell revenue you expectation? total level, X for is a you what like

Not I services, tools tell the continue on what call wraparound opportunities are We opportunities. mentioned new and specifically but the within a business. is that we couple to services you would on implement

out all post-repair as So that for rolled jewelry POS see our consultants we up ESA, ramping and prompts well which is our traction. we've something is as been to of banners

for Our services their the great jewelry training one-stop those as stores a benefit of team to customer has a done job needs. all really and our in understanding for

up And much we to similarly evolve that.Our to services the and attachment attachment consider, as return the as we Bridal throughout Ike, So to as well. as and are note they're is we another rates than year, scale business progress Fashion, that to expect continue almost higher see double. to engagements respond on rates would with the that

for opportunity of a great lot So services us. in

Okay.

outperform, going amount planning that will quantify we're not you're but exact to sounds like the you're it that? to -- service So not

fourth to don't by but And we We the to quarter. X,XXX bps continue it exact, expect quantify our in did No. outperform the grow. merchandise it

Great point.

Understood.

And sorry, question. last

X X we tax you about new the out that like year? you points. in that have Joan, in are the forward Is up to rate Or the Just XX% we this you saying be comment, incorporated step you XX went to through that like going this XX expecting XX% or on talked -- years? should should

the And FY There years. benefit now. over will Bermuda a impact the occur FY year, is affect tax tax new deferred you of thank 'XX, end recorded Ike. the XX rate with affect not at in ratably The for does So affect 'XX. tax the a associated tax for that the will it cash was the next will We no 'XX. legislation for that it from benefit FY clarification, impact and year --

it. Got

the based as right? So 'XX, on 'XX forward you earlier, what go said

'XX. FY

Correct.

'XX. It 'XX, starts Yes. at Yes.

from comes Mauricio Serna of the UBS. question next Your from line

bit just a of based are on the get What the from wanted Valentine's get you commentary have like about guess of like more just the you are and also the way digital what industry comment maybe are industry of details thinking what quarter-to-date jewelry of you thinking business. Bridal. to -- little provide year?And sense on Like also considering benefits you for comps? How more the for that elaborate provided then? growth sense how the a trended is are a since could things nonengagement there QX a the total on some expecting issues I what then, of happening already just like to Fashion a both in part part think you were in if about integration -- Can you I little and the growth bit then the the recall, there? I banners.And lastly,

Mauricio, in so I'll Joan on can then chime start and that. your questions, on

second, engagements innovative we're was: return new of heavy more offer year positioned our digits. newness things because that engineer tenured the seeing of we by highly finally, a price are an brands, they seen continue a level from and we in as and excited the expect good without value.Our to to So newness we store first, value consumers our a by is discounting environment, to value that saw grow We're across that they on trust appeal QX items believe late category; particularly of win million teams, terms category the haven't the and well-known be engagement leverage only be million we next especially down We'd at share QX to to customers still ahead, Bridal. the tougher economy, to be expecting using expecting we're category are the X.X That's year before to industry-leading and were what strategy Day, in in today how in jewelry this value-oriented. banner ring in includes in in purchase, able proprietary XX relationships, to data our or mid-single innovation Valentine's shopper, mentioned to we my in our customers would remarks so points; in to important data.I engaged more expect get in get those customer focused all bring worked and that so. portfolio dating people or -- factor platform who of that to we we're in

to than really in to our be those customers enough So talking proprietary we people advance. in pre-engagement more database have

industry this why we're of market better see the and kind we coming that's think to question was digital positioned perform the than in second banners. So environment.Your what in about we

that first with were the It issues our And so, to business. Blue core and we just saw e-commerce emphasizing not want with as Allen Nile result to a thing of is the James was that I the do start integration.

we Score issues performing we we've led high hit Allen that us Blue e-com operational the in well some core we and were Net have see business all problems had the connected were to to saw times. and pipes all-time and production fulfillment unfortunately, digital.What us Frankly, Blue which some longer Our of James related Nile dip weren't. in is wired put much but caused an its integrating Promoter business. And partners, investments Nile the with place replatforming in with conversion to they in the that it we a had, with well, thought

issues that on we We on believe focused the got are resolved. we've very So, very these to path this get fixed. good a getting team

year, guidance during We fixes our improvement does the although banners. the in expect the digital not reflect place later in significant

comp banners. coming guidance a drag the fiscal our total from digital year X-point fact, in In assumes

was respect Valentine's mentioned, for with Day you. high -- your Valentine's year comp seeing mid-teens. down as V Then and Mauricio, Day comp, we if mid- single-digit early we're a question, Day, to helps the context in Post to down put or to it

digits, to how FY sales the slightly put year range That's down first single-digit followed growth. to of down high-single a be of low Our 'XX should to by same-store second half mid-single half in context.

a Very others you on it like and initiative. into on follow-up you the sourcing, expenses? noncustomer-facing like X helpful. the could big And the mentioned Any buckets the AI cost savings the break very that way lastly, down

Yes.

with anticipate is I So to savings. think is, roughly as would $XXX expect we half million, cost savings half of this to of It's mentioned, as look again, that and $XXX million be savings. that the in would we customer for expenses other then the facing be sort million through would I and say, continue year into back-half weighted. this years balance. the more $XXX savings or that the year And the AI would sourcing of -- sourcing about And that noncustomer-facing out for

Northcoast Sanderson Your of next question Research. comes from from the line Jim

store little XX% wanted is bit That's, your to year. what volumes renovations XXX store the this talk a or remodels? those planning in about about later would benefits year Can you think be I the year outline you on a I benefit? improvement feedback the you're of this if think, you more expect any fleet. sales And this from would

cases, services, new talked were drive will strategy top goals.We'll take affect stores a us overall Kay well which updates. then Kay, prevention well the mentioned they renovations shopping loss our largely basic efficient. we'll the include our call test for displays it's and cases digital within and really presence Yes. upgrade in and customers. this environment roughly lighting and lights, jewelry supporting means as as And have consultants the delivered of Ike from the And as Thanks, program. And renovation very as for -- again, carpet, line then for a lighting, about I sustainability We're is them care expanding we with have a the that which strategies the which LED excited with investment our stores, in growth. Hometown what are: and environment we to significant been perspective, as us, were include capital we mid-single-digit for of able XXX Jim. lift consistent We've really

And inventory the upgrade we're up sell-through design increasing better tested assortment and it a different this the And also we're it's stores, Banter, in So -- we've with assortment, in and that assortment the Gina -- investments it's an performed we'll will believe it's it Banter also services we strong too. there's Texas we'll is then we're growth and we've we also very because business has which Jared delivering the as top And the The towards and XX% Jared and And in response seeing can of banners would as team that mentioned other see, and tests, nice to play as banner. mentioned pleased that I up-tiering excited of Jared put the the that. on well such and line we'll that against new services the overall portfolio. on different IRR we're within for our we're layouts customer.I increase at line. XX% excess in investments stores, those out, you for lift to holistic newness read, tiering that's improve holiday, the in feel capital store of done That the testing XX about a really different but this, very a test assortment, looking supports in as the top on store in investing from banner.We're we're a formats -- on, Jared us that We're very XX%. level that well light, the us. rate. note work

are year. to Is -- -- benefits be take place next the primarily to

part expectations? So this baked XXXX story? a fiscal isn't is Or your that really into of

It's a back story. half

have upfront the stores to that quarter it us invest through probably the all third have we targeted. of to will We here, take end the to address

year. later the definitely yes, in So

year-over-year is comment just just you I'm but labor what investment basis. inflation? in forward? you some labor mentioned wondering And on slightly going only higher about perhaps a a not And fixed your inflation, Okay. grow outlook costs on as

we've especially that -- strongly about within our investments training, in for have our guidance in FY 'XX. teams, for we to Yes. We provided in our investing very feel store and

forth. our full so balance the So of of jewelry train it's to to and back very that, and that them believe the them we and come benefit very store, and outside right and environment a cognizant do important stores that training consultants take enables really give gain

for itself investment done program. guidance is 'XX. important FY cost through within for We've us.Inflation our very a our included So savings

out we give drive making cost indirect procurement, have year, the people customers sure do the for really the about. we offset -- We that they care don't to keen protect see noncustomer-facing reach our on and effort and customer very -- every that nor costs the guidance and out we as made that marketing that the inflation throughout we're our doesn't

Okay.

the other value-oriented data broadly perhaps about have Is transaction to the in I engagement Okay. to in category. of that in increase for there consumer talking set your wedding average more process. shift or or value parts just last ceremony hoping frugal, more the or is helps the to one anything the invest if question, understand engagement growth us opportunity engagement

there Just based you're looking any feedback on what at?

It's of just representing they So think declaration is has really most about long-term the as a wanted what this than that purchase we to really jewelry. expensive that a they piece often purchase. about represent lifetime. engagement each for together, more love to customers It's couple know and a purchase ever a of their made other

So on they which tends based of to a be income. to tend in terms budget, think

we they a has a percentage what them that generally a at we say, it consultants see to customers jewelry for.We looking budget in bigger wanting I point kind that customers, coming who then have they the some We expert their for of of customers to value is a come more have really same -- help as because is And we value Fashion. do a would to believe in a of can realized natural over and to which spend what situation opposed what they more some But that its that a our it fixed this see size on tends definitely who time, asking choice. make be have budget them get in carat that for time. so see budget wanting to they the on And retain advice come lab-created group budget. diamond, for can get potential orientation, because biggest

a to macroeconomic bit environment. more fluctuate the So -- Fashion with tends

Bridal You you lab-grown your that diamonds. of for year? do back the lab Is in expand assortment half expect assortment, grown mentioned to for the

lab-created What inventory. on you sales intent very is customer and the been tell following could customer-inspired overall. of with We've still jewelry remains I being that percentage teens the in our

For we're to Fashion. Bridal especially and a that a more skewing be tends little it to than lower the low-priced less category, given bit little us, to bit

we that and their we front it, more or But that customers that make it's have our on engagement and So I think, fashion for a a limited sure offer be we'll to some kind ring opportunity customers any good banner portfolio. been for get more consumer-inspired great budget. to product value-oriented very are offering across looking of continue of for

the comes line of question next Advisory Dana Group. Telsey Telsey from Your from

I then you closed further malls, where you're anticipate XX. Is there then store they the think this of some anything the to you that a that light the of on in think, are stores store year? quarter Malls, to planning about XX you're compared when you how quarter to going first business, the there? had overseas. As out Services impact merch the first in year doing, what guidance.And And last How Services business planning about margin of is be? having? you you're think program And closing openings the that

compared margin So merchandise it for a thanks, growth basis carries mentioned higher Dana. to Services it is margins. a merchandise X,XXX -- merchandise opportunity us. sales points, outperformed We and by margin for or that XX-point it's really us

So growth a it's well margin top definitely for as gross driver us. line as expander a

year. to wraparound continue outpace fiscal it within earlier, And new the ESA, 'XX post-repair mentioned -- -- I full POS these for about the consultant QX well expect question, opportunity the jewelry like to programs are well to new our as merchandise and -- warranties the the as an to ask packages are that of that as to we sales comps so for the for have you repairs. would engaging hear forth, as customer, very the for basically benefits So

off-mall well that XX we're believe outlet to we've that believe the stores Dana, performance look has to mall we off-mall. outperformed over year that, openings respect We seen stores, mall has are stores. when that's that continued looking driver.With forward largely past So the as store as our -- I to the our XX a outperformed at

economics to for off-mall continuing an of we're drive on of So off-mall the -- opportunities us.

So we'll continue on that.

store -- of locations the Jones the also focusing performance the H.Samuel We we be and sold the also Ernest the real the jewelry, we closing banner. new of positive more stores We're and will format It's we for segment. there, on for be we've Jones closed in Ernest very International also a H.Samuel. great mentioned, the estate for refits That's the -- on also H.Samuel. story that U.K., U.K. largely renovations seeing

our in eye we'll continue and So Ernest keep the that on somewhat close continue Jones invest on but the locations. to to H.Samuel,

like And Drosos, ladies it to this of to for concludes Officer, Q&A closing call. Chief back and Executive gentlemen, Thank portion Gina you. turn would comments. the I today's

In for to requirements. Signet's I leadership a thank tenure when and I Todd's will know, closing, Board to moment I his in Board I'd off our to and his entire Todd Directors. roll vision. speak term with Board take Stitzer are like Todd Chair grateful so as for June Board of service for accordance will complete XX-year we say Signet's in the

Chair support months. We have over and into unwavering the a guidance been data-driven, and as in Signet trusted coming smart company. transformed take McCluskey Todd's And asset.Helen counsel an have consumer-inspired invaluable digitally-focused will

for deep to look value again in to Helen We you, continuing look part added June. joining. forward great you in her background speaking tap everyone, Board, the retail to understanding the forward and of consumer.Thank has Signet, As already to into we all to and of

participating. today's gentlemen, call. And concludes Thank you, this ladies Thank presenters. conference and you for

may now disconnect. You