Michael Hill (ASX:MHJ) sales shine in 1H FY21

• Michael Hill (MHJ) has revealed it expects between $41 million to $45 million in earnings before interest and taxes (EBIT) in 1H FY21
• This could be a potential 40 per cent growth from $31.6 million experienced in 1H FY20
• Additionally, online sales were up 102 per cent with digital sales now representing 5.8 per cent of all sales
• Despite having to close stores due to COVID-19, many of Michael Hills offices are back up and running
• MHJ has also announced Chief Operating Officer Andrea Slingsby and Chief Brand & Customer Officer Vanessa Brennan will leave the business the pursue new opportunities
• As a result, Amy Sznicer will join the team as Chief Retail Officer and Jo Feeney will onboard as Chief Marketing Officer
• Michael Hill is up 6.62 per cent on the market and shares are trading at 72.5 cents

Michael Hill (MHJ) has revealed it expects between $41 million to $45 million in earnings before interest and taxes (EBIT) in 1H FY21.

This could be a potential 40 per cent growth from $31.6 million delivered in 1H FY20.

Additionally, online sales were up 102 per cent, with digital sales now representing 5.8 per cent of all sales, an increase from 2.8 per cent in 1H FY20.

Store update

Australia & New Zealand

Following COVID-19 headwinds, Michael Hill saw its Melbourne stores close the previous quarter, however, 28 reopened in late October and have since resumed trading.

At the end of the quarter, all 154 Australian stores were back up and running.

Michael Hill’s New Zealand stores, however, fared far better as none of its 49 stores closed.

Canada

Of the 86 Canadian stores, 21 closed throughout November and December, while a further 25 closed from Boxing Day.

At the end of the quarter, 40 stores were trading.

During all its store closures, a number of initiatives were deployed, such as virtual selling, contactless pick-up, and click and reserve.

Leadership shuffle

Alongside its financial update, Michael Hill has announced some changes to its leadership team.

Chief Operating Officer Andrea Slingsby and Chief Brand & Customer Officer Vanessa Brennan will both leave the business to pursue new opportunities.

As a result, Amy Sznicer will join the team as Chief Retail Officer and Jo Feeney will onboard as Chief Marketing Officer.

“Following a string first five months, it was particularly pleasing to see all markets deliver positive same-store sales growth for the all-important Christmas trading period,” CEO Daniel Bracken said.

“I am delighted that our strong trading performance across the half, coupled with our unwavering focus on costs, has, in turn, delivered material EBIT growth for the group, in spite of challenging trading conditions worldwide,” he added.

Michael Hill is up 6.62 per cent on the market and shares are trading at 72.5 cents at 2:23 pm AEDT.