Michael Hill International Struggles in New Zealand as Group Revenue Slips

Highlights:

• Michael Hill International Limited (NZX: MHJ) reported a 0.7% drop in group revenue, totaling A$360.2 million (NZ$398.98 million) for the half-year ending December 29.
• Comparable EBIT declined to A$24.1 million, down from A$31.3 million in the first half of 2023, reflecting challenging retail conditions.
• New Zealand stores underperformed, contributing to the company’s overall revenue decline amid a tough economic environment.

Stock Performance and Revenue Decline

Michael Hill International Limited (ASX: MHJ) reported a decline in group revenue, reflecting challenging retail conditions, particularly in New Zealand. At the time of writing, the jeweller’s total revenue for the half-year ending December 29 stood at A$360.2 million (NZ$398.98 million), marking a 0.7% drop from the previous period's A$362.7 million.

Earnings Decline Amid Market Challenges

The company's comparable earnings before interest and tax (EBIT) fell to A$24.1 million, which aligns with the upper range of its previous guidance but remains significantly lower than the A$31.3 million EBIT recorded in the first half of 2023. This decline highlights ongoing challenges in the retail sector, particularly in New Zealand, where the company has faced headwinds.

Outlook and Market Sentiment

Despite the revenue slip, Michael Hill International remains focused on navigating market conditions by optimizing store performance and maintaining its growth strategy. Investors will closely monitor the company’s approach to tackling weak consumer sentiment and adapting to evolving retail dynamics.

As Michael Hill International adjusts to these challenges, its performance in the upcoming quarters will be crucial in determining its resilience in the competitive jewellery market.

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