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Michael Hill lifts first-quarter revenue 14% on rising North American sales

Friday 5th October 2012

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Michael Hill International, the listed jewellery chain, lifted first-quarter revenue rose 14 percent in New Zealand dollar terms, boosted by an improvement in its North American and Australian markets.

Total sales climbed to $116.4 million in the three months ended Sept. 30, from $101.8 million a year earlier, the Brisbane-based company said in a statement. Same-store sales rose 8.5 percent to $108 million.

Total Canadian sales jumped 29 percent to $12.3 million, followed by Australia up 14 percent to $78.9 million.

"All markets traded well over the first quarter and it was pleasing to see our largest market Australia lift its performance after a slow down during 2011-12," chairman, Michael Hill said. "The sales growth shown during the quarter was achieved without the need to reduce margins."

In August, the company posted a 5.8 percent increase in annual profit to $36.5 million as recovering sales in New Zealand, Canada and the US made up for shrinking revenue in Australia, which is the current financial year's focus.

US sales rose 10.6 percent to $2.5 million in the latest period, while New Zealand sales increased 8 percent to $22.7 million.

Sales for the company's professional care plan, which offers maintenance and repairs on jewellery, rose 20 percent to $6.5 million.

"The directors are satisfied with the performance over the first quarter however the key December quarter is now upon us and this will to a large extent determine the group's result for the year," Hill said.

The company shares fell 1.7 percent to $1.13 yesterday and have gained 32 percent this year. The stock is rated an average 'outperform' based on the consensus of two analyst recommendations compiled by Reuters.

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