SOURCE: Signet Jewelers Limited

March 30, 2011 07:30 ET

Signet Reports Strong Fiscal 2011 Results

Diluted EPS Up 26.8%, Including Cost of Retiring Outstanding Debt

Adjusted Diluted EPS Climbs 45.4% to $2.66

HAMILTON, BERMUDA--(Marketwire - March 30, 2011) - Signet Jewelers Ltd ("Signet") (NYSE: SIG) (LSE: SIG), the world's largest specialty retail jeweler, today announced its results for the 13 weeks ("fourth quarter") and for the 52 weeks ("Fiscal 2011") ended January 29, 2011.

                                                          Fiscal 2011
                                                          -----------
-- Same store sales                                         up 6.7%
-- Income before income taxes                      $300.4 million, up 30.3%
-- Adjusted income before income taxes excluding
   non-recurring item(1)                           $347.9 million, up 50.9%
-- Diluted earnings per share                           $2.32, up 26.8%
-- Adjusted diluted earnings per share excluding
   non-recurring item(2)                                $2.66, up 45.4%
-- Free cash flow(3) excluding non-recurring item(1)    $315.8 million

Mike Barnes, Chief Executive Officer, commented: "Fiscal 2011 was an outstanding year for Signet with same store sales up 6.7%, adjusted income before tax increasing 50.9% and free cash flow of $315.8 million before the Make Whole Payment. I would like to thank all members of the Signet team for their contribution to this great performance.

We believe that Signet is well positioned to gain profitable market share and improve operating margins as a result of our competitive strengths in the bridal category, the further development of brands that differentiate us from our competitors, our long term focus on best in class customer service, and traffic generating marketing campaigns that leverage our leading share of voice. These strengths are increasingly setting us apart in the retail marketplace.

We have had an encouraging start to Fiscal 2012, with same store sales in the first seven weeks up by 8.5%, compared with 6.6% for the comparable period last year. The US division increased by 11.4%, against 8.2% last year, and the UK division was down by 4.6%, compared to a decrease of 0.1% last year."

(1) The non-recurring item is a $47.5 million Make Whole payment arising
    from prepayment of private placement notes on November 26, 2010, after
    tax cost $29.5 million (the "Make Whole Payment"); non-GAAP measure,
    see Note 6.  This may also be referred to as "Adjusted income before
    tax."
(2) Diluted earnings per share excluding Make Whole Payment; non-GAAP
    measure see Note 6.
(3) Net cash provided by operating activities less cash flow used in
    investing activities; non-GAAP measure, see Note 6.

Signet operated 1,857 specialty retail jewelry stores at January 29, 2011, these included 1,317 stores in the US, where its store brands include "Kay Jewelers", "Jared The Galleria Of Jewelry" and a number of regional names. At the same date, Signet also operated 540 stores in the UK, where its store brands are "H.Samuel", "Ernest Jones" and "Leslie Davis". Further information on Signet is available at www.signetjewelers.com. See also www.kay.com, www.jared.com, www.hsamuel.co.uk and www.ernestjones.co.uk.

Conference Call

There will be a conference call today at 8.30 a.m. Eastern Time (1.30 p.m. BST and 5.30 a.m. Pacific Time) and a simultaneous audio webcast and slide presentation available at www.signetjewelers.com. The slides are available to be downloaded from the website ahead of the conference call. To help ensure the conference call begins in a timely manner, all participants should dial in 5 to 10 minutes prior to the scheduled start time. The call details are:

US dial-in:          +1 (212) 444 0895      Access code: 2553140
European dial-in:    +44 (0)20 7138 0844    Access code: 2553140

A replay of the conference call and a transcript of the call will be posted on Signet's website as soon as is practical after the call has ended and will be available for one year.

This release contains statements which are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements, based upon management's beliefs and expectations as well as on assumptions made by and data currently available to management, appear in a number of places throughout this release and include statements regarding, among other things, Signet's results of operation, financial condition, liquidity, prospects, growth, strategies and the industry in which Signet operates. The use of the words "expects," "intends," "anticipates," "estimates," "predicts," "believes," "should," "potential," "may," "forecast," "objective," "plan," or "target," and other similar expressions are intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to a number of risks and uncertainties, including but not limited to general economic conditions, the merchandising, pricing and inventory policies followed by Signet, the reputation of Signet and its brands, the level of competition in the jewelry sector, the cost and availability of diamonds, gold and other precious metals, regulations relating to consumer credit, seasonality of Signet's business, financial market risks, deterioration in consumers' financial condition, exchange rate fluctuations, changes in consumer attitudes regarding jewelry, management of social, ethical and environmental risks, inadequacy in and disruptions to internal controls and systems, changes in assumptions used in making accounting estimates relating to items such as extended service plans and pensions, and risks relating to Signet being a Bermuda corporation.

For a discussion of these and other risks and uncertainties which could cause actual results to differ materially, see the "Risk Factors" section of Signet's Fiscal 2010 Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission on March 30, 2010. Actual results may differ materially from those anticipated in such forward-looking statements. Signet undertakes no obligation to update or revise any forward-looking statements to reflect subsequent events or circumstances, except as required by law.

FISCAL 2011 OVERVIEW

The strong results for Fiscal 2011 were led by a same store sales increase of 6.7% (52 weeks to January 30, 2010 ("Fiscal 2010"): decrease of 0.4%), total sales were up by 5.0% to $3,437.4 million (Fiscal 2010: $3,273.6 million) and operating margin improving by 270 basis points to 10.8% (Fiscal 2010: 8.1%). As a result, income before income taxes and diluted earnings per share rose to $300.4 million (Fiscal 2010: $230.5 million) and $2.32 (Fiscal 2010: $1.83), up by 30.3% and 26.8% respectively. Excluding the Make Whole Payment, income before income taxes and diluted earnings per share rose to $347.9 million and $2.66, up by 50.9% and 45.4% respectively, non-GAAP measures, see Note 6.

Free cash flow at $315.8 million excluding the Make Whole Payment; non-GAAP measure, see Note 6 (Fiscal 2010: $471.9 million), was substantially higher than the original objective for the year of $150 million to $200 million. Signet took advantage of its strong balance sheet and financial flexibility to prepay all outstanding Private Placement Notes (the "Notes"), significantly reducing future interest expense and eliminating restrictive covenants, including limitations on shareholder distributions and capital expenditure. As a result, a Make Whole Payment of $47.5 million was incurred. At January 29, 2011, Signet had no long term debt (January 30, 2010: $280 million) and cash and cash equivalents of $302.1 million (January 30, 2010: $316.2 million).

RESULTS OF OPERATIONS

Fiscal 2011

Sales and operating income

In Fiscal 2011, Signet's same store sales increased by 6.7%, compared to a decline of 0.4% in Fiscal 2010. Total sales rose by 5.0% to $3,437.4 million (Fiscal 2010: $3,273.6 million). The breakdown of the sales performance is set out in Table 1 below.

Table 1                                              Fiscal 2011
                                           -------------------------------
                                               US         UK       Signet
Sales, million                             $ 2,744.2  $   693.2  $ 3,437.4
% of total                                    79.8%      20.2%     100.0%

Change in sales                                US         UK       Signet
                                               %          %          %
                                           ---------  ---------  ---------
Same store sales                               8.9       (1.4)       6.7
Change in store space                         (0.9)      (1.6)      (1.1)
                                           ---------  ---------  ---------
Total change in sales at constant exchange
 rates(1,2)                                    8.0       (3.0)       5.6
Exchange translation                            --       (2.5)      (0.6)
                                           ---------  ---------  ---------
Change in sales as reported                    8.0       (5.5)       5.0
                                           ---------  ---------  ---------

(1) The average US dollar to pound sterling exchange rate in Fiscal 2011
    was $1.55 (Fiscal 2010: $1.59).
(2) Non-GAAP measure, see Note 6.

In Fiscal 2011, Signet's gross margin was $1,242.9 million (Fiscal 2010: $1,065.6 million), an increase of 16.6%. The gross margin rate increased by 360 basis points to 36.2% (Fiscal 2010: 32.6%). The gross merchandise margin improved by 80 basis points, driven by price increases, lower diamond costs, less discounting, and favorable mix changes, which more than offset the impact of higher gold costs and the weakness of the pound sterling against the US dollar. The net bad debt to total US sales ratio improved compared to Fiscal 2010 and leverage on store occupancy costs, particularly in the US, also benefited gross margin.

Selling, general and administrative expenses for Fiscal 2011 were $980.4 million (Fiscal 2010: $916.5 million), up by 7.0%. The increase primarily reflected higher incentive payments, the non-recurrence of the Fiscal 2010 benefit due to the change in US vacation entitlement policy, management transition costs and higher advertising expenditure.

In Fiscal 2011, other operating income was $110.0 million (Fiscal 2010: $115.4 million), down by 4.7%. This reflected the impact of the amendments to the Truth in Lending Act that were implemented during the year and were largely offset by a higher level of outstanding customer finance balances and an increase in rate of interest charged.

In Fiscal 2011, net operating income increased by 40.8% to $372.5 million (Fiscal 2010: $264.5 million, after a $13.4 million non-recurring, favorable impact from a change in US vacation entitlement policy). Operating margin was 10.8% (Fiscal 2010: 8.1%). The net direct adverse impact on operating income from the amendments to the Truth in Lending Act was estimated by management to be $11.9 million.

Interest income and expense

In Fiscal 2011, interest income was $0.7 million (Fiscal 2010: $0.8 million). Interest expense was $72.8 million (Fiscal 2010: $34.8 million), the majority of which related to the $47.5 million Make Whole Payment incurred as a result of prepaying the Notes in full during the fourth quarter. The Notes incurred a blended fixed rate of interest of 8.11%.

Income before income taxes

For Fiscal 2011, income before income taxes was up 30.3% to $300.4 million (Fiscal 2010: $230.5 million), and income before income taxes excluding the Make Whole Payment was up 50.9% to $347.9 million (Fiscal 2010: $230.5 million); non-GAAP measure, see Note 6.

Income taxes

The charge to income taxes for Fiscal 2011 was $100.0 million (Fiscal 2010: $73.4 million), an effective tax rate of 33.3% (Fiscal 2010: 31.8%), the increase reflecting a higher proportion of profits earned in the US where the tax rate is higher, offset by the benefit from intra-group financing arrangements and the favorable resolution of certain prior year tax issues.

Net income

Net income for Fiscal 2011 was up 27.6% to $200.4 million (Fiscal 2010: $157.1 million), and net income excluding the Make Whole Payment was up 46.3% to $229.9 million; non-GAAP measure, see Note 6.

Earnings per share

For Fiscal 2011, basic and diluted earnings per share were $2.34 and $2.32 (Fiscal 2010: $1.84 and $1.83) an increase of 27.2% and 26.8% respectively. Excluding the Make Whole Payment, basic and diluted earnings per share were $2.68 and $2.66, up 45.7% and 45.4% respectively; non-GAAP measures, see Note 6.

Fourth Quarter Fiscal 2011

Sales and operating income

In the fourth quarter same store sales were up 8.1%, compared to an increase of 5.1% in the fourth quarter of Fiscal 2010, and total sales rose by 6.2% to $1,270.5 million (13 weeks to January 30, 2010: $1,196.8 million). The breakdown of the sales performance is set out in Table 2 below.

Table 2                                            Fourth Quarter
                                           -------------------------------
                                               US         UK       Signet
Sales, million                             $ 1,007.0  $   263.5  $ 1,270.5
% of total                                    79.3%      20.7%     100.0%

Change in sales                                US         UK       Signet
                                               %          %          %
                                           ---------  ---------  ---------
Same store sales                              11.4       (2.9)       8.1
Change in store space                         (1.2)      (1.6)      (1.3)
                                           ---------  ---------  ---------
Total change in sales at constant exchange
 rates(1)                                     10.2       (4.5)       6.8
Exchange translation                            --       (2.3)      (0.6)
                                           ---------  ---------  ---------
Change in sales as reported                   10.2       (6.8)       6.2
                                           ---------  ---------  ---------

(1) Non-GAAP measure, see Note 6.

In the fourth quarter, gross margin was $518.5 million (13 weeks to January 30, 2010: $431.4 million), an increase of 20.2%. Gross margin rate increased by 480 basis points to 40.8% (13 weeks to January 30, 2010: 36.0%). Gross merchandise margin increased by 80 basis points. Selling, general and administrative expenses were $336.7 million (13 weeks to January 30, 2010: $282.6 million). Other operating income in the fourth quarter was $28.7 million (13 weeks to January 30, 2010: $28.4 million), and the net direct adverse impact of the amendments to the Truth in Lending Act was estimated to be $2.1 million. Fourth quarter net operating income increased by 18.8% to $210.5 million (13 weeks to January 30, 2010: $177.2 million), and the operating margin was 16.6% (13 weeks to January 30, 2010: 14.8%).

Interest income and expense

Interest income was $0.1 million for the fourth quarter (13 weeks to January 30, 2010: $0.1 million) and interest expense was $51.0 million (13 weeks to January 30, 2010: $7.6 million).

Income before income taxes

For the fourth quarter, income before income taxes was down 6.0% to $159.6 million (13 weeks to January 30, 2010: $169.7 million), income before income taxes excluding the Make Whole Payment was up 22.0% to $207.1 million; non-GAAP measure, see Note 6.

Income taxes

The charge to income taxes in the fourth quarter was $54.2 million (13 weeks to January 30, 2010: $54.2 million), an effective tax rate of 34.0% (13 weeks to January 30, 2010: 31.9%).

Net income

For the fourth quarter, net income was down 8.7% to $105.4 million (13 weeks to January 30, 2010: $115.5 million), and net income excluding the Make Whole Payment was up 16.8% to $134.9 million; non-GAAP measure, see Note 6.

Earnings per share

In the fourth quarter, basic and diluted earnings per share were $1.23 and $1.21 (13 weeks to January 30, 2010: $1.35 and $1.34), down 8.9% and 9.7% respectively. Excluding the Make Whole Payment, basic and diluted earnings per share were $1.57 and $1.55, up 16.3% and 15.7% respectively; non-GAAP measures, see Note 6.

CAPITAL EXPENDITURE AND FREE CASH FLOW

In Fiscal 2011, capital expenditure was $57.5 million (Fiscal 2010: $43.6 million). The US division's capital expenditure was $44.5 million (Fiscal 2010: $31.1 million), and the UK division's was $13.0 million (Fiscal 2010: $12.5 million).

In Fiscal 2011, positive free cash flow, excluding the Make Whole Payment, was $315.8 million (Fiscal 2010: $471.9 million); non-GAAP measure, see Note 6.

At January 29, 2011, Signet had no long term debt (January 30, 2010: $280.0 million). On March 9, 2010, Signet made a prepayment at par of $50.9 million of the Notes. On November 26, 2010, Signet exercised its right to prepay in full the remaining $229.1 million of outstanding Notes. This resulted in a reduction in interest expense of $101.7 million over the remaining term of the Notes. The prepayment required the payment of all accrued interest up to the Prepayment Date plus a premium, the Make Whole Payment, which amounted to $47.5 million. At January 29, 2011, Signet had cash and cash equivalents of $302.1 million (January 30, 2010: $316.2 million).

OPERATING REVIEW

US division (79.8% of annual sales)

Fiscal 2011

In Fiscal 2011, the US division's sales were up by 8.0% to $2,744.2 million (Fiscal 2010: $2,540.4 million) and same store sales rose by 8.9% compared to a rise of 0.2% in Fiscal 2010. See Table 3 below for analysis of sales growth.

Table 3                                         Change from previous year
                                                --------------------------
Fiscal 2011                           Average                     Average
                                       unit               Same     unit
                                      selling    Total    store   selling
                            Sales     price(1)   sales    sales   price(1)
Kay                        $1,592.9m    $330       6.4%     7.0%      7.6%
Jared                        $848.3m    $763      18.1%    15.7%      7.0%
Regional brands              $303.0m    $342      (6.8)%    1.9%      4.0%
                          ----------
US division                $2,744.2m    $389       8.0%     8.9%      8.0%
                          ==========

(1) Excludes the charm bracelet category, a product with an average unit
    selling price considerably lower, and a multiple purchase and frequency
    of purchase much greater, than products historically sold by the
    division.

In Fiscal 2011, the US division's net operating income increased by 52.7% to $342.7 million (Fiscal 2010: $224.5 million, after a $13.4 million non-recurring, favorable impact from a change in US vacation entitlement policy). The net direct adverse impact from amendments to the Truth in Lending Act is estimated by management to be $11.9 million in Fiscal 2011. The operating margin in Fiscal 2011 was up by 370 basis points to 12.5% (Fiscal 2010: 8.8%), reflecting higher sales per store resulting in leverage of store occupancy costs, an increased gross merchandise margin and a lower net bad debt to total US sales ratio, which more than offset the adverse impact of the amendments to the Truth in Lending Act, the absence of the non-recurring benefit in Fiscal 2010 from the change in vacation entitlement policy, higher incentive pay and increased advertising expenditure.

In Fiscal 2011, both the bridal category and branded differentiated and exclusive products increased their share of the US division's sales. In the bridal category, the convergence of superior customer service, supply chain expertise and the ability to offer in-house customer finance resulted in an outstanding customer experience, giving the US division a significant competitive sales advantage. Within the bridal category, Neil Lane Bridal(tm) and the Tolkowsky® Diamond were tested successfully. Branded differentiated and exclusive merchandise, such as The Leo Diamond®, Open Hearts by Jane Seymour®, Love's Embrace(tm), Le Vian® and Charmed Memories®, increased their participation by about 300 basis points to 22% of the US division's merchandise sales. In addition, Jared also benefited from a recovery in spending among US households with above average incomes, and the continued expansion of the Pandora® range. The US division's market share of the specialty jewelry market increased by 30 basis points to 9.3%.

In Fiscal 2011, average unit selling price for the US division, excluding the charm bracelet category, rose by 8.0%, reflecting changes in the store brand sales mix, customers trading up the US division's pricing structure, merchandising initiatives, and selective price increases made during Fiscal 2011. Including the charm bracelet category, the average unit selling price decreased, but was more than compensated for by the volume of units sold, which increased significantly.

In Fiscal 2011, the US division's gross merchandise margin was up by 120 basis points compared to Fiscal 2010 and benefited from selective price increases implemented in the first and third quarters of Fiscal 2011, lower average diamond inventory costs, and reduced price discounting, which more than offset a higher cost of gold.

In-house customer finance participation in the US division was 54.2% (Fiscal 2010: 53.9%) and the net bad debt to total US sales ratio was 4.2% (Fiscal 2010: 5.6%). Management believes this reduction reflected the quality of credit authorization and collection procedures, and a more stable rate of unemployment. The average monthly collection rate was 12.6% (Fiscal 2010: 12.5%). Net US customer in-house finance receivables at January 29, 2011 were $927.7 million (January 30, 2010: $849.3 million).

Selling, general and administrative expenses were tightly controlled in Fiscal 2011, but variable expenses rose due to the level of sales and operating income growth achieved. Also in Fiscal 2011, gross advertising expenditure increased by 5.6% to $161.5 million (Fiscal 2010: $153.0 million), a marketing to sales ratio of 5.9% (Fiscal 2010: 6.0%). The higher level of gross advertising expenditure mainly reflected fourth quarter activity, with both an increased level of television advertising impressions and media cost inflation. Television adverting impressions in the fourth quarter of Fiscal 2011 were up 5% for Kay and 10% for Jared.

Stores opened and closed in Fiscal 2011 and in the fourth quarter and are set out in Table 4 below.

                                                                   Annual
Table 4           Kay       Kay     Regional                      net space
                 mall(1)  off-mall   brands    Jared(2)   Total    change
January 30, 2010   794       129       260       178      1,361      (1)%
Opened              1         1         --        2         4
Closed             (11)      (3)       (9)        --       (23)
                --------  --------  --------  --------- --------
October 30, 2010   784       127       251       180      1,342
Opened              1         1         --        --        2
Closed             (5)       --        (22)       --       (27)
                --------  --------  --------  --------- --------
January 29, 2011   780       128       229       180      1,317      (2)%
                ========  ========  ========  ========= ========

(1) Includes stores in downtown locations.
(2) A Jared store is equivalent in size to about four mall stores.

Fourth Quarter Fiscal 2011

In the fourth quarter, the US division's sales were $1,007.0 million (13 weeks to January 30, 2010: $914.0 million) up by 10.2%, and same store sales rose by 11.4% compared to a rise of 7.3% in the fourth quarter of Fiscal 2010. See Table 5 below for further analysis of sales.

Table 5                                       Change from previous year
                                           -------------------------------
Fourth quarter Fiscal 2011       Average                          Average
                                  unit                  Same       unit
                                 selling     Total      store     selling
                        Sales    price(1)    sales      sales     price(1)
Kay                     $608.8m   $298        9.9%      10.7%        9.0%
Jared                   $292.2m   $721       18.8%      17.5%        9.2%
Regional brands         $106.0m   $315       (7.2)%      1.3%        9.4%
                     ----------
US division           $1,007.0m   $351       10.2%      11.4%       10.8%
                     ==========

(1) Excludes the charm bracelet category, a product with an average unit
    selling price considerably lower, and a multiple purchase and frequency
    of purchase much greater, than products historically sold by the
    division.

In the fourth quarter, the US division's net operating income increased by 38.2% to $167.9 million (13 weeks to January 30, 2010: $121.5 million, which included a $1.6 million non-recurring, adverse impact from a change in vacation entitlement policy), and the operating margin was 16.7% (13 weeks to January 30, 2010: 13.3%). In-house customer finance participation was 51.5% in the fourth quarter (13 weeks to January 30, 2010: 50.8%). The net bad debt to total US sales ratio was 3.8% (13 weeks to January 30, 2010: 5.0%). The average monthly collection rate was 12.2% in the fourth quarter (13 weeks to January 30, 2010: 12.0%). Gross merchandise margin was up 140 basis points compared to the fourth quarter of Fiscal 2010. The net direct adverse impact of amendments to the Truth in Lending Act was estimated to be $2.1 million in the fourth quarter.

UK division (20.2% of annual sales)

Fiscal 2011

In Fiscal 2011, the UK division's sales were down by 5.5% to $693.2 million (Fiscal 2010: $733.2 million), and down 3.0% at constant exchange rates; non-GAAP measure, see Note 6. Same store sales decreased by 1.4%, compared to a decline of 2.4% in Fiscal 2010. See Table 6 below for further analysis of sales.

                                            Change from previous year
Table 6                               ------------------------------------
Fiscal 2011                  Average           Sales at            Average
                              unit             constant     Same    unit
                             selling    Total  exchange    store   selling
                     Sales   price(1,2) sales  rates(3,4)  sales   price(2)
H.Samuel             $373.4m   GBP 57   (5.2)%     (2.8)%   (1.6)%     8.0%
Ernest Jones(5)      $319.5m  GBP 249   (4.2)%     (1.7)%   (1.1)%     9.3%
Other                  $0.3m       nm     nm         nm       nm        nm
                    --------
UK division          $693.2m   GBP 89   (5.5)%     (3.0)%   (1.4)%     9.2%
                    ========

(1) The average unit selling price2 for H.Samuel was $88, for Ernest Jones
    was $386 and for the UK division was $138.
(2) Excludes the charm bracelet category, a product with an average unit
    selling price considerably lower, and a multiple purchase and frequency
    of purchase much greater, than product historically sold by the
    division.
(3) Non-GAAP measure, see Note 6.
(4) The exchange translation impact on the total sales of H.Samuel was
    (2.4)%, and for Ernest Jones was (2.5)%.
(5) Includes stores selling under the Leslie Davis nameplate.
nm - not meaningful.

In Fiscal 2011, net operating income for the UK division increased by 0.9% to $57.0 million (Fiscal 2010: $56.5 million), an increase of 3.4% at constant exchange rates; non-GAAP measure, see Note 6. The UK division's operating margin increased by 50 basis points to 8.2% (Fiscal 2010: 7.7%), reflecting a tight control of costs, which more than offset lower sales and a decrease in gross merchandise margin.

In Fiscal 2011, the charm bracelet category continued to perform well, as did fashion watches and the bridal category, including gold rings. Average unit selling price, excluding the charm bracelet category, increased by 9.2% in Fiscal 2011, primarily reflecting price increases implemented to counter pressure on gross merchandise margin. The UK division's gross merchandise margin rate was down by 40 basis points in Fiscal 2011 compared to Fiscal 2010. The impact of a weak pound sterling to US dollar exchange rate, an increase in the cost of gold and a higher rate of value added tax were largely offset by price increases. Store occupancy costs were tightly controlled. Selling, general and administrative expenses were also closely managed. In Fiscal 2011, gross advertising expenditure increased by 1.8% to $16.6 million (Fiscal 2010: $16.3 million), a marketing to sales ratio of 2.4% (Fiscal 2010: 2.2%), and an increase of 4.5% in pounds sterling. The higher level of gross advertising expenditure reflected fourth quarter activity, with both an increased level of television advertising impressions and media inflation.

Stores closed in Fiscal 2011 and the fourth quarter are set out in Table 7 below.


Table 7
                                   Ernest                Annual net
                      H.Samuel     Jones(1)   Total     space change
January 30, 2010         347        205        552          (1)%
Opened                    --         --         --
Closed                   (5)        (3)        (8)
                      ---------  ---------  ---------
October 30, 2010         342        202        544
Opened                    --         --         --
Closed                   (4)         --        (4)
                      ---------  ---------  ---------
January 29, 2011         338        202        540          (2)%
                      =========  =========  =========

(1) Includes stores selling under the Leslie Davis nameplate.

Fourth Quarter Fiscal 2011

In the fourth quarter, sales were down by 6.8% to $263.5 million (13 weeks to January 30, 2010: $282.8 million), reflecting an adverse impact of 2.3% from movements in the pound sterling to US dollar exchange rate, a reduction of 1.6% due to changes in space and a decrease in same store sales of 2.9% (13 weeks to January 30, 2010: down 1.5%). See Table 8 below for further analysis of sales.

                                            Change from previous year
Table 8                               ------------------------------------
Fourth quarter Fiscal 2011   Average           Sales at            Average
                               unit            constant     Same    unit
                             selling   Total   exchange     store  selling
                     Sales  price(1,2) sales   rates(3,4)   sales  price(2)
H.Samuel             $149.7m   GBP 56   (5.2)%     (2.8)%   (1.7)%     5.2%
Ernest Jones(5)      $113.8m  GBP 231   (8.2)%     (6.0)%   (4.6)%     8.6%
                    --------
UK division          $263.5m   GBP 84   (6.8)%     (4.5)%   (2.9)%     5.8%
                    ========

(1) The average unit selling price2 in the fourth quarter for H.Samuel was
    $87, for Ernest Jones was $358 and for the UK division was $130.
(2) Excludes the charm bracelet category, a product with an average unit
    selling price considerably lower, and a multiple purchase and
    frequency of purchase much greater, than product historically sold by
    the division.
(3) Non-GAAP measure, see Note 6.
(4) The exchange translation impact on the total sales of H.Samuel was
    (2.4)% and for Ernest Jones was (2.2)%.
(5) Includes stores selling under the Leslie Davis nameplate.

In the fourth quarter, the UK division's net operating income decreased by 8.4% to $55.3 million (13 weeks to January 30, 2010: $60.4 million), a decrease of 6.3% at constant exchange rates; non-GAAP measure, see Note 6. The gross merchandise margin percentage was down 50 basis points from the fourth quarter of Fiscal 2010. The operating margin in the fourth quarter was 21.0% (13 weeks to January 30, 2010: 21.4%).

Unallocated costs

Unallocated costs, principally central costs that are not allocated to the US or UK division in Signet's management accounts, were $27.2 million in Fiscal 2011 (Fiscal 2010: $16.5 million). The increase primarily reflected the cost to transition management.

In the fourth quarter, unallocated costs were $12.7 million (13 weeks to January 30, 2010: $4.7 million).

STRATEGY & FINANCIAL OBJECTIVES

Fiscal 2011 was an outstanding year for Signet. In Fiscal 2012, profit growth and generation of strong cash flow remain priorities. Therefore, the strategy in Fiscal 2012 is broadly similar to that of Fiscal 2011. Both the US and the UK divisions are specialty jewelry industry leaders and continue to endeavor to meet customer expectations by further enhancing our competitive advantages. This is expected to increase the performance gap between Signet and others in the sector in the basic retail disciplines of store operations, supply chain management, merchandising, marketing and quality retail estate.

Signet's strategy in Fiscal 2012 is to:

    -- further enhance Signet's position as the world's largest specialty
       retail jeweler, through superior execution;
    -- improve store productivity;
    -- increase investment to strengthen the competitive position of the
       business; and
    -- maintain a strong balance sheet and financial flexibility.

Accordingly, we plan to invest in our sales associates to drive improvements in customer service; continue to develop and expand distribution of branded differentiated and exclusive merchandise; increase advertising expenditure; invest in information systems, including internet technology that will assist the business to execute more efficiently and effectively; seek ways to improve the supply chain; and increase the number of store refurbishments and openings. The goal is to deliver a superior customer experience by being best in class in all areas of the business, as is appropriate for the industry leader.

In setting the financial objectives for Fiscal 2012, consideration was given to the current operating environment, which remains challenging, with the developments in the US and UK economies becoming increasingly divergent. There is stabilization in the US economy and growth in the US jewelry market. The UK economy is being impacted by pressure on discretionary spending due to the government's austerity program, which includes an increase in the value added tax rate implemented on January 4, 2011, and higher consumer inflation at a time of limited growth in personal disposable income.

In Fiscal 2012, management's financial objectives for the business are the
following:

    -- gain profitable market share;
    -- improve gross margin ratio;
    -- maintain selling, general and administrative expenses to sales ratio
       broadly similar to the level of Fiscal 2011, flexing primarily with
       expenses which vary with sales;
    -- capital expenditure of $110 million to $130 million; and
    -- positive free cash flow of between $150 million and $200 million;
       non-GAAP measure, see Note 6.

Management anticipates that the gross margin ratio will benefit from improved store productivity, which is expected to offset the impact of changes in the cost of commodities, in particular the cost of diamonds and gold, and provide leverage of occupancy costs and net bad debt expense.

The projected interest expense in Fiscal 2012 is $6 million to $7 million, primarily reflecting facility fees and bank service charges. It is expected that, subject to the geographic mix of taxable income and the outcome of uncertain tax positions, Signet's effective tax rate in Fiscal 2012 will be approximately 36%.

Investment will be directed, where prudent, to both inventory and capital projects, which are intended to build competitive advantage and support sales growth. It is planned to carry out 105 major store refurbishments and relocations (Fiscal 2011: 64 stores), and increase the number of store openings in the US to 25 (Fiscal 2011: 6), see Table 9 below. The UK division plans to open two and close 22 stores in Fiscal 2012 (Fiscal 2011: opened 0 and closed 12). It is therefore expected that net square footage in the US division will be unchanged and that in the UK division it will decrease by approximately 3%.

                                                                     Net
Table 9               Kay       Kay     Regional                    space
Change in US stores  mall(1)  off-mall   brands   Jared(2)   Total  change
January 29, 2011         780       128       229       180   1,317    (2)%
Openings (planned)         8        13        --         4      25
Closures (forecast)       (7)       (8)      (21)       --     (36)
                     -------  --------  --------  -------- -------
January 28, 2012         781       133       208       184   1,306     0%
                     -------  --------  --------  -------- -------

(1) Includes stores in downtown locations.
(2) A Jared store is equivalent in size to about four mall stores.

IR PROGRAM DETAILS

TAG Conference, New York, on Thursday, March 31, 2011

Signet will be taking part in the TAG Conference, New York, on Thursday, March 31, 2011 in New York. Present will be Mike Barnes, Chief Executive Officer and Ron Ristau, Chief Financial Officer.

Barclays Capital Conference, New York, on Wednesday, April 27, 2011

Signet will be taking part in the Barclays Capital Conference, New York, on Wednesday, April 27, 2011 in New York. Present will be Mike Barnes, Chief Executive Officer and Ron Ristau, Chief Financial Officer.

Condensed consolidated income statements

                              13 weeks  13 weeks
                                 ended     ended
                               January   January    Fiscal    Fiscal
                              29, 2011  30, 2010      2011      2010
                              $million  $million  $million  $million  Notes
                              --------  --------  --------  --------  -----

Sales                          1,270.5   1,196.8   3,437.4   3,273.6
Cost of sales                   (752.0)   (765.4) (2,194.5) (2,208.0)
                              --------  --------  --------  --------  -----

Gross margin                     518.5     431.4   1,242.9   1,065.6
Selling, general and
 administrative expenses        (336.7)   (282.6)   (980.4)   (916.5)
Other operating income, net       28.7      28.4     110.0     115.4
                              --------  --------  --------  --------  -----

Operating income, net            210.5     177.2     372.5     264.5
Interest income                    0.1       0.1       0.7       0.8
Interest expense                 (51.0)     (7.6)    (72.8)    (34.8)
                              --------  --------  --------  --------  -----

Income before income taxes       159.6     169.7     300.4     230.5
Income taxes                     (54.2)    (54.2)   (100.0)    (73.4)     3
                              --------  --------  --------  --------  -----

Net income                       105.4     115.5     200.4     157.1
                              --------  --------  --------  --------  -----

Earnings per share - basic    $   1.23  $   1.35  $   2.34  $   1.84      4
                   - diluted  $   1.21  $   1.34  $   2.32  $   1.83      4
                              --------  --------  --------  --------  -----


The accompanying notes are an integral part of these condensed consolidated
financial statements




Condensed consolidated balance sheets

                                            January 29,  January 30,
                                                  2011         2010
                                              $million     $million   Notes
                                            -----------  -----------  -----
Assets
                                            -----------  -----------  -----
Current assets:
Cash and cash equivalents                         302.1        316.2
Accounts receivable, net                          935.9        858.0
Other receivables                                  38.2         27.9
Other current assets                               79.2         75.8
Deferred tax assets                                 2.7          2.2      3
Inventories                                     1,184.2      1,173.1
                                            -----------  -----------  -----

Total current assets                            2,542.3      2,453.2
                                            -----------  -----------  -----
Non-current assets:
Property, plant and equipment, net of
 accumulated depreciation of $614.4 million,
 and $566.0 million, respectively                 351.5        396.9
Other intangible assets, net                       27.5         24.2
Other assets                                       59.7         58.3
Deferred tax assets                                86.0        112.3      3
Retirement benefit asset                           22.8           --
                                            -----------  -----------  -----

Total assets                                    3,089.8      3,044.9
                                            -----------  -----------  -----

Liabilities and Shareholders' equity

Current liabilities:
Loans and overdrafts                               31.0         44.1
Accounts payable                                  125.9         66.2
Accrued expenses and other current
 liabilities                                      292.4        272.1
Deferred revenue                                  146.0        137.7      5
Deferred tax liabilities                           77.1         74.7      3
Income taxes payable                               38.6         44.1
                                            -----------  -----------  -----

Total current liabilities                         711.0        638.9
                                            -----------  -----------  -----

Non-current liabilities:
Long-term debt                                       --        280.0
Other liabilities                                  86.6         79.6
Deferred revenue                                  353.2        338.0      5
Retirement benefit obligation                        --          4.8
                                            -----------  -----------  -----

Total liabilities                               1,150.8      1,341.3

                                            -----------  -----------  -----

Shareholders' equity:
Common shares of $0.18 par value:
 authorized 500 million shares, 86.2
 million shares issued and outstanding
 (2010: 85.5 million shares issued and
 outstanding)                                      15.5         15.4
Additional paid-in capital                        196.8        169.9
Other reserves                                    235.2        235.2
Treasury shares                                      --         (1.1)
Retained earnings                               1,662.3      1,462.4
Accumulated other comprehensive loss             (170.8)      (178.2)
                                            -----------  -----------  -----

Total shareholders' equity                      1,939.0      1,703.6
                                            -----------  -----------  -----

Total liabilities and shareholders' equity      3,089.8      3,044.9
                                            -----------  -----------  -----


The accompanying notes are an integral part of these condensed
consolidated financial statements.




Condensed consolidated statements of cash flows


                                13 weeks   13 weeks
                                   ended      ended
                                 January    January     Fiscal     Fiscal
                                29, 2011   30, 2010       2011       2010
                                $million   $million   $million   $million
                                ---------  ---------  ---------  ---------
Cash flows from operating
 activities:
Net income                          105.4      115.5      200.4      157.1
Adjustments to reconcile net
 income to cash flows provided
 by operating activities:
  Depreciation of property,
   plant and equipment               24.2       26.3       89.7      101.0
  Amortization of other
   intangible assets                  2.3        2.4        8.1        7.9
  Pension                            (2.0)      (2.5)      (7.0)      (5.3)
  Share-based compensation            9.5        1.3       17.2        5.6
  Deferred taxation                   5.0       14.1       25.1       11.2
  Facility amendment fees
   included in net income             1.6        0.3        4.8        4.3
  Other non-cash movements           (0.7)       1.7       (2.6)       0.8
  Profit on disposal of
   property, plant and equipment     (0.1)      (0.4)      (1.0)        --

Changes in operating assets and
 liabilities:
Increase in accounts receivable    (166.3)    (127.9)     (78.7)     (32.4)
(Increase)/decrease in other
 receivables and other assets       (21.0)      (7.0)     (14.9)      47.2
Increase in other current
 assets                              (5.8)     (12.5)      (4.0)     (29.3)
Decrease/(increase) in
 inventories                        106.4      127.3      (19.5)     226.5
(Decrease)/increase in accounts
 payable                            (52.6)     (72.9)      59.4       22.0
Increase/(decrease) in accrued
 expenses and other liabilities      45.6       42.7       25.1       (5.5)
Increase in deferred revenue         34.5       32.7       23.6       14.8
Increase/(decrease) in income
 taxes payable                       39.9       24.5       (3.7)      (9.8)
Effect of exchange rate changes
 on currency swaps                    1.1        0.7        1.9       (0.7)
                                ---------  ---------  ---------  ---------

Net cash provided by operating
 activities                         127.0      166.3      323.9      515.4
                                ---------  ---------  ---------  ---------

Investing activities:
Purchase of property, plant and
 equipment                          (12.7)     (11.4)     (46.0)     (35.8)
Purchase of other intangible
 assets                              (3.6)      (1.8)     (11.5)      (7.8)
Proceeds from sale of property,
 plant and equipment                  0.2         --        1.9        0.1
                                ---------  ---------  ---------  ---------

Net cash used in investing
 activities                         (16.1)     (13.2)     (55.6)     (43.5)
                                ---------  ---------  ---------  ---------

Financing activities:
Proceeds from issue of common
 shares                               9.3        0.1       11.3        1.0
Facility amendment fees paid           --         --       (1.3)      (9.3)
(Repayment of)/proceeds from
 short-term borrowings               (6.6)      27.8      (13.1)    (143.4)
Repayment of long-term debt        (229.1)        --     (280.0)    (100.0)
                                ---------  ---------  ---------  ---------

Net cash (used in)/provided by
 financing activities              (226.4)      27.9     (283.1)    (251.7)
                                ---------  ---------  ---------  ---------

Cash and cash equivalents at
 beginning of period                414.9      139.6      316.2       96.8
(Decrease)/increase in cash and
 cash equivalents                  (115.5)     181.0      (14.8)     220.2
Effect of exchange rate changes
 on cash and cash equivalents         2.7       (4.4)       0.7       (0.8)
                                ---------  ---------  ---------  ---------

Cash and cash equivalents at
 end of period                      302.1      316.2      302.1      316.2
                                ---------  ---------  ---------  ---------


The accompanying notes are an integral part of these condensed
consolidated financial statements.




Condensed consolidated statement of shareholders' equity


                                                         Accumulated
             Common                                         other    Total
             shares  Additional                            compre-  share-
             at par   paid-in   Other   Treasury Retained  hensive holders'
              value   capital  reserves  shares  earnings   loss    equity
             $million $million $million $million $million $million $million
             -------- -------- -------- -------  -------  -------  -------
Balance at
 January 30,
 2010            15.4    169.9    235.2    (1.1) 1,462.4   (178.2) 1,703.6
Net income         --       --       --      --    200.4       --    200.4
Foreign
 currency
 translation       --       --       --      --       --     (1.9)    (1.9)
Changes in
 fair value
 of derivative
 instruments,
 net of tax        --       --       --      --       --     (5.2)    (5.2)
Pension plan,
 net of tax        --       --       --      --       --     14.5     14.5
Share options
 exercised        0.1     12.1       --     1.1     (0.5)      --     12.8
Share-based
 compensation
 expense           --     14.8       --      --       --       --     14.8
             -------- -------- -------- -------  -------  -------  -------

Balance at
 January 29,
 2011            15.5    196.8    235.2      --  1,662.3   (170.8) 1,939.0
             -------- -------- -------- -------  -------  -------  -------



Condensed consolidated statements of comprehensive income


                                       13 weeks 13 weeks
                                          ended    ended
                                        January  January   Fiscal   Fiscal
                                       29, 2011 30, 2010     2011     2010
                                       $million $million $million $million
                                        -------  -------  -------  -------
Net income                                105.4    115.5    200.4    157.1
Foreign currency translation                0.4     (5.0)    (1.9)    21.4
Changes in fair value of derivative
 instruments                              (10.2)    (3.5)    (7.7)    (8.6)
Pension plan                               17.2      1.3     20.0      4.0
Deferred tax on items recognized in
 equity                                    (1.2)    (0.2)    (3.0)     0.5
                                        -------  -------  -------  -------

Comprehensive income                      111.6    108.1    207.8    174.4
                                        -------  -------  -------  -------


The accompanying notes are an integral part of these condensed
consolidated financial statements.



1. Basis of preparation

This financial information has been prepared in accordance with accounting
principles generally accepted in the United States of America ("US GAAP")
and has been prepared on the basis of the accounting policies set out in
Signet's audited financial statements which will be filed as part of the
annual report on Form 10-K for Fiscal 2011.

This financial information does not constitute Signet's financial
statements for Fiscal 2011 or Fiscal 2010, but is derived from these
financial statements. Signet's audited financial statements will be filed
as part of the annual report on Form 10-K for Fiscal 2011. This is
expected to be filed with the SEC on March 30, 2011 and will be available
for download from Signet's website www.signetjewelers.com.

Correction of immaterial error

During the third quarter of Fiscal 2011, Signet changed its accounting for
extended service plans. Previously, revenue from the sale of extended
service plans was deferred, net of direct costs arising from the sale, and
was recognized in proportion to the historical actual claims incurred.
Signet has conducted a review of the claims cost patterns, including
estimates of future claims costs expected to be incurred, and concluded
that the deferral period required extension and that claims cost is a more
appropriate basis for revenue recognition than the number of claims
incurred. In addition, Signet now defers all revenues and recognizes
direct costs in proportion to the revenue recognized. These changes are in
accordance with ASC 605-20-25. This resulted in an overstatement of
extended service plan revenue and an understatement of deferred revenue.
These plans are only sold by the US division and therefore only affect the
US segment reporting.

Signet has evaluated the effects individually and in the aggregate and
determined that its prior period financial statements are not materially
misstated. However, Signet has determined that the cumulative effect of
adjusting this would be material to the Fiscal 2011 financial statements.
Therefore, Signet has adjusted the affected prior periods and presented
the results in this report.

As a result of applying this correction, the following consolidated
balance sheet, consolidated income statement and consolidated statement
of cash flows were impacted as follows:


Impact on consolidated balance sheet                  January 30, 2010
                                                          $million
                                                  -------------------------
                                                    Amounts
                                                   previously
                                                    reported   As corrected
                                                  ------------ ------------
Assets
Current assets:
Other current assets                                      58.4         75.8
Total current assets                                   2,435.8      2,453.2
Non-current assets:
Other assets                                              12.6         58.3
Deferred tax assets                                       54.7        112.3
Total assets                                           2,924.2      3,044.9

Liabilities and Shareholders' equity
Current liabilities:
Deferred revenue                                         120.1        137.7
Total current liabilities                                621.3        638.9
Non-current liabilities:
Deferred revenue                                         140.9        338.0
Total liabilities                                      1,126.6      1,341.3
Total shareholders' equity                             1,797.6      1,703.6
Total liabilities and shareholders' equity             2,924.2      3,044.9
                                                  ------------ ------------



Impact on consolidated income
 statement                           13 weeks ended       52 weeks ended
                                    January 30, 2010     January 30, 2010
                                        $million             $million
                                  -------------------  -------------------
                                   Amounts              Amounts
                                  previously    As     previously   As
                                  reported   corrected reported   corrected
                                  ---------  --------  ---------  --------
Sales                               1,203.6   1,196.8    3,290.7   3,273.6
Cost of sales                        (769.5)   (765.4)  (2,213.8) (2,208.0)
Gross margin                          434.1     431.4    1,076.9   1,065.6
Operating income                      179.9     177.2      275.8     264.5
Income before income taxes            172.4     169.7      241.8     230.5
Income taxes                          (55.2)    (54.2)     (77.7)    (73.4)
Net income                            117.2     115.5      164.1     157.1
Earnings per share - basic        $    1.37  $   1.35  $    1.92  $   1.84
Earnings per share - diluted      $    1.36  $   1.34  $    1.91  $   1.83
                                  ---------  --------  ---------  --------



Impact on consolidated statement
 of cash flows                       13 weeks ended       52 weeks ended
                                    January 30, 2010     January 30, 2010
                                        $million             $million
                                  -------------------  -------------------
                                   Amounts              Amounts
                                  previously    As     previously   As
                                  reported   corrected reported   corrected
                                  ---------  --------  ---------  --------
Cash flows from operating
 activities:
 Net income                           117.2     115.5      164.1     157.1
Adjustments to reconcile net
 income to cash flows provided
 by operating activities:
  Deferred income taxes                15.1      14.1       15.5      11.2
Changes in operating assets and
 liabilities:
 (Increase)/decrease in other
  receivables and other assets         (4.0)     (7.0)      51.4      47.2
  Increase in other current assets    (11.4)    (12.5)     (27.7)    (29.3)
  Increase/(decrease) in deferred
   revenue                             25.9      32.7       (2.3)     14.8
                                  ---------  --------  ---------  --------


2. Foreign currency translation

The exchange rates used for the translation of UK pound sterling
transactions and balances in these condensed consolidated financial
statements are as follows:

                                               Fiscal   Fiscal
                                                 2011     2010
                                              -------- --------
Income statement (average rate)                  1.55     1.59
Balance sheet (period end rate)                  1.59     1.60
                                              -------- --------


The year-to-date average exchange rate is used to prepare the income
statement for the 52 weeks ended January 29, 2011 and is calculated from
the weekly average exchange rates weighted by sales of the UK division.
The income statement for the 13 weeks ended January 29, 2011 is calculated
as the difference between the income statement for the 52 weeks ended
January 29, 2011 and the previously reported income statement for the 39
weeks ended October 30, 2010. Therefore, the fourth quarter's income
statement includes the impact of the change in the year-to-date exchange
rates between these quarter ends.



3. Income taxes

                                                 Fiscal     Fiscal
                                                   2011       2010
                                               $million   $million
                                              ---------  ---------
Current taxation  - US                             63.6       42.5
                  - Foreign                        11.3       19.7

Deferred taxation - US                             25.3       13.8
                  - Foreign                        (0.2)      (2.6)
                                              ---------  ---------
Total income taxes                                100.0       73.4
                                              ---------  ---------



Signet has business activity in all states within the US and files income
tax returns for the US federal jurisdiction and all applicable states.
Signet also files income tax returns in the UK and certain other foreign
jurisdictions. Signet is subject to US federal and state examinations by
tax authorities for tax years after October 28, 2006 and is subject to
examination by the UK tax authority for tax years after January 31, 2008.

As of January 29, 2011 Signet had approximately $9.0 million (Fiscal 2010:
$14.9 million) of unrecognized tax benefits in respect of uncertain tax
positions, all of which would favorably affect the effective income tax
rate if resolved in Signet's favor. These unrecognized tax benefits relate
to financing arrangements and intra-group charges which are subject to
different and changing interpretations of tax law.

During Fiscal 2011, agreement was reached in respect of the treatment of
certain financing arrangements in the UK and a cash settlement was paid of
approximately $1.6 million, excluding interest thereon. A benefit of
approximately $2.8 million has been recognized in income tax expense during
Fiscal 2011.

During Fiscal 2011, the statute of limitations lapsed in the US in respect
of the tax year ended October 28, 2006 with no adjustment to taxable
income. A benefit of approximately $1.8 million has been recognized in
income tax expense during Fiscal 2011.

Apart from the above, there has been no material change in the amount of
unrecognized tax benefits in respect of uncertain tax positions during
Fiscal 2011.

Signet recognizes accrued interest and, where appropriate, penalties
related to unrecognized tax benefits within income tax expense. In Fiscal
2011, the total amount of interest and penalties recognized in income tax
expense in the consolidated income statement was $1.2 million, net credit
(Fiscal 2010: $0.3 million, net credit). As of January 29, 2011, Signet had
accrued interest of $1.0 million (Fiscal 2010: $2.2 million).

Over the next twelve months, management believes that it is reasonably
possible that there could be a reduction of substantially all of the
unrecognized tax benefits as of January 29, 2011, due to settlement of the
uncertain tax positions with the tax authorities.



4. Earnings per share


                                 13 weeks   13 weeks
                                    ended      ended
                                  January    January     Fiscal     Fiscal
                                 29, 2011   30, 2010       2011       2010
                                ---------- ---------- ---------- ----------
Net income ($million)                105.4      115.5      200.4      157.1
                                ---------- ---------- ---------- ----------
Basic weighted average number
 of shares in issue (million)         85.8       85.5       85.7       85.3
Dilutive effect of share
 options (million)                     1.0        0.5        0.7        0.4
                                ---------- ---------- ---------- ----------

Diluted weighted average number
 of shares in issue (million)         86.8       86.0       86.4       85.7
                                ---------- ---------- ---------- ----------

Earnings per share - basic      $     1.23 $     1.35 $     2.34 $     1.84
Earnings per share - diluted    $     1.21 $     1.34 $     2.32 $     1.83
                                ---------- ---------- ---------- ----------

The basic weighted average number of shares excludes shares held by the
Employee Stock Ownership Trust or as Treasury Shares as such shares are not
considered outstanding and do not qualify for dividends. The effect of
excluding these shares is to reduce the average number of shares in the 13
and 52 week periods ended January 29, 2011 by 10,994 and 11,365 shares
respectively (13 and 52 week periods ended January 30, 2010: 31,694 and
64,085 shares respectively). The calculation of fully diluted earnings per
share for the 13 and 52 week periods ended January 29, 2011 excludes
options to purchase 438,713 and 815,562 shares respectively (13 and 52 week
periods ended January 30, 2010: 972,388 and 2,333,995 share options
respectively) on the basis that their effect on earnings per share was
anti-dilutive.



5. Deferred revenue

Deferred revenue represents income under extended service warranty plans,
voucher promotions and other items.

                                                January    January
                                               29, 2011   30, 2010
                                               $million   $million
                                              ---------- ----------
Warranty deferred revenue                          481.1      458.3
Voucher promotions and other items                  18.1       17.4
                                              ---------- ----------

Total deferred revenue                             499.2      475.7
                                              ---------- ----------

Current liabilities                                146.0      137.7
Non-current liabilities                            353.2      338.0
                                              ---------- ----------

Total deferred revenue                             499.2      475.7
                                              ---------- ----------



                                13 weeks   13 weeks
                                   ended      ended
                                 January    January     Fiscal     Fiscal
                                29, 2011   30, 2010       2011       2010
                                $million   $million   $million   $million
                                ---------  ---------  ---------  ---------
Warranty deferred revenue,
 beginning of period                458.4      436.1      458.3      440.8
  Warranties sold                    60.4       58.0      171.1      159.2
  Revenues recognized               (37.7)     (35.8)    (148.3)    (141.7)
                                ---------  ---------  ---------  ---------

Warranty deferred revenue,
 end of period                      481.1      458.3      481.1      458.3
                                ---------  ---------  ---------  ---------



6. Non-GAAP measures and other information

Income statement as a percentage of sales


                                       13 weeks 13 weeks
                                          ended    ended
                                        January  January   Fiscal   Fiscal
                                       29, 2011 30, 2010     2011     2010
                                              %        %        %        %
                                        -------  -------  -------  -------

Sales                                     100.0    100.0    100.0    100.0
Cost of sales                             (59.2)   (64.0)   (63.8)   (67.4)
                                        -------  -------  -------  -------

Gross margin                               40.8     36.0     36.2     32.6

Selling, general and administrative
 expenses                                 (26.5)   (23.6)   (28.5)   (28.0)
Other operating income, net                 2.3      2.4      3.1      3.5
                                        -------  -------  -------  -------

Operating income, net                      16.6     14.8     10.8      8.1
Net interest expense                       (4.0)    (0.6)    (2.1)    (1.1)
                                        -------  -------  -------  -------

Income before income taxes                 12.6     14.2      8.7      7.0
Income taxes                               (4.3)    (4.5)    (2.9)    (2.2)
                                        -------  -------  -------  -------

Net income                                  8.3      9.7      5.8      4.8
                                        -------  -------  -------  -------


A number of non-GAAP measures are used by management to analyze and manage
the performance of the business, and the required disclosures for these
non-GAAP measures are given below. Management does not, nor does it suggest
investors should consider such non-GAAP measures in isolation from, or in
substitution for, information prepared in accordance with US GAAP.

Income statement at constant exchange rates

Movements in the US dollar to pound sterling exchange rate have an impact
on Signet's results. The UK division is managed in pounds sterling as sales
and costs are incurred in that currency and its results are then translated
into US dollars for external reporting purposes. Management believes it
assists in understanding the performance of Signet and its UK division if
constant currency figures are given. This is particularly so in periods
when exchange rates are volatile. The constant currency amounts are
calculated by retranslating the prior year figures using the current year's
exchange rate. Management considers it useful to exclude the impact of
movements in the pound sterling to US dollar exchange rate to analyze and
explain changes and trends in Signet's sales and costs.


a) Fiscal 2011 percentage change in results at constant exchange rates


                                                                    Fiscal
                                                         Fiscal       2011
                                                        2010 at  change at
                                             Impact of  constant  constant
                                              exchange  exchange  exchange
                  Fiscal    Fiscal                rate     rates     rates
                    2011      2010            movement (non-GAAP)(non-GAAP)
                $million  $million  Change %  $million  $million        %
                --------  --------  --------  --------  --------  --------

Sales            3,437.4   3,273.6       5.0     (18.5)  3,255.1       5.6
Cost of sales   (2,194.5) (2,208.0)     (0.6)     12.6  (2,195.4)       --
                --------  --------  --------  --------  --------  --------
Gross margin     1,242.9   1,065.6      16.6      (5.9)  1,059.7      17.3
Selling,
 general and
 administrative
 expenses         (980.4)   (916.5)      7.0       4.9    (911.6)      7.5
Other operating
 income, net       110.0     115.4      (4.7)       --     115.4      (4.7)
                --------  --------  --------  --------  --------  --------
Operating
 income, net       372.5     264.5      40.8      (1.0)    263.5      41.4
Interest income      0.7       0.8     (12.5)       --       0.8     (12.5)
Interest expense   (72.8)    (34.8)    109.2        --     (34.8)    109.2
                --------  --------  --------  --------  --------  --------
Income before
 income taxes      300.4     230.5      30.3      (1.0)    229.5      30.9
Income taxes      (100.0)    (73.4)     36.2       0.3     (73.1)     36.8
                --------  --------  --------  --------  --------  --------
Net income         200.4     157.1      27.6      (0.7)    156.4      28.1
                --------  --------  --------  --------  --------  --------

Earnings per
 share - basic  $   2.34  $   1.84      27.2  $  (0.01) $   1.83      27.9
Earnings per
 share -
 diluted        $   2.32  $   1.83      26.8  $  (0.01) $   1.82      27.5
                --------  --------  --------  --------  --------  --------


b) Fourth quarter Fiscal 2011 percentage change in results at constant
exchange rates



                                                        13 weeks  13 weeks
                                                           ended     ended
                                                         January   January
                                                        30, 2010  29, 2011
                                                              at change at
                13 weeks  13 weeks           Impact of  constant  constant
                   ended     ended            exchange  exchange  exchange
                 January   January                rate     rates     rates
                29, 2011  30, 2010            movement (non-GAAP)(non-GAAP)
                $million  $million  Change %  $million  $million        %
                --------  --------  --------  --------  --------  --------

Sales            1,270.5   1,196.8       6.2      (7.0)  1,189.8       6.8
Cost of sales     (752.0)   (765.4)     (1.8)      4.2    (761.2)     (1.2)
                --------  --------  --------  --------  --------  --------
Gross margin       518.5     431.4      20.2      (2.8)    428.6      21.0
Selling,
 general and
 administrative
 expenses         (336.7)   (282.6)     19.1       1.5    (281.1)     19.8
Other operating
 income, net        28.7      28.4       1.1        --      28.4       1.1
                --------  --------  --------  --------  --------  --------
Operating
 income, net       210.5     177.2      18.8      (1.3)    175.9      19.7
Interest income      0.1       0.1        --        --       0.1        --
Interest expense   (51.0)     (7.6)       nm        --      (7.6)       nm
                --------  --------  --------  --------  --------  --------
Income before
 income taxes      159.6     169.7      (6.0)     (1.3)    168.4      (5.2)
Income taxes       (54.2)    (54.2)       --       0.4     (53.8)      0.7
                --------  --------  --------  --------  --------  --------
Net income         105.4     115.5      (8.7)     (0.9)    114.6      (8.0)
                --------  --------  --------  --------  --------  --------

Earnings per
 share - basic  $   1.23  $   1.35      (8.9) $  (0.01) $   1.34      (8.2)
Earnings per
 share -
 diluted        $   1.21  $   1.34      (9.7) $  (0.01) $   1.33      (9.0)
                --------  --------  --------  --------  --------  --------

nm - not meaningful



c) Fiscal 2011 reconciliation to underlying results


                                                        Impact      Fiscal
                                                       of Make        2011
                                             Fiscal      Whole   underlying
                                               2011    Payment   (non-GAAP)
                                           $million   $million    $million
                                           ---------  ---------  ---------
Sales by origin and destination:
US                                           2,744.2         --    2,744.2
UK                                             693.2         --      693.2
                                           ---------  ---------  ---------

Total sales                                  3,437.4         --    3,437.4
                                           ---------  ---------  ---------

Operating income/(loss):
US                                             342.7         --      342.7
UK                                              57.0         --       57.0
Unallocated                                    (27.2)        --      (27.2)
                                           ---------  ---------  ---------
Total operating income                         372.5         --      372.5
Interest income                                  0.7         --        0.7
Interest expense                               (72.8)      47.5      (25.3)
                                           ---------  ---------  ---------
Income before income taxes                     300.4       47.5      347.9
Income taxes                                  (100.0)     (18.0)    (118.0)
                                           ---------  ---------  ---------
Net income                                     200.4       29.5      229.9
                                           ---------  ---------  ---------

Earnings per share - basic                 $    2.34  $    0.34  $    2.68
Earnings per share - diluted               $    2.32  $    0.34  $    2.66
                                           ---------  ---------  ---------


d) Fiscal 2011 percentage change in underlying results compared to Fiscal
2010 as reported and at constant exchange rates


                                                                   Fiscal
                                                                     2011
                                                                    under-
                                                          Fiscal    lying
                                        Fiscal           2010 at  change at
                                          2011   Under-  constant constant
                                        under-   lying   exchange  exchange
                                         lying   change    rates    rates
              Fiscal   Fiscal            (non-   (non-     (non-    (non-
                2011     2010  Change     GAAP)   GAAP)     GAAP)    GAAP)
            $million $million     %    $million     %    $million     %
             -------  -------  -------  -------  -------  -------  -------
Sales by
 origin and
 destination:
US           2,744.2  2,540.4      8.0  2,744.2      8.0  2,540.4      8.0
UK             693.2    733.2     (5.5)   693.2     (5.5)   714.7     (3.0)
             -------  -------  -------  -------  -------  -------  -------
Total sales  3,437.4  3,273.6      5.0  3,437.4      5.0  3,255.1      5.6
             -------  -------  -------  -------  -------  -------  -------

Operating
 income/(loss):
US             342.7    224.5     52.7    342.7     52.7    224.5     52.7
UK              57.0     56.5      0.9     57.0      0.9     55.1      3.4
Unallocated    (27.2)   (16.5)    64.8    (27.2)    64.8    (16.1)    68.9
             -------  -------  -------  -------  -------  -------  -------
Total operating
 income        372.5    264.5     40.8    372.5     40.8    263.5     41.4
             -------  -------  -------  -------  -------  -------  -------

Income before
 income taxes  300.4    230.5     30.3    347.9     50.9    229.5     51.6
             -------  -------  -------  -------  -------  -------  -------
Net income     200.4    157.1     27.6    229.9     46.3    156.4     47.0
             -------  -------  -------  -------  -------  -------  -------

Earnings per
 share -
 basic       $  2.34  $  1.84     27.2  $  2.68     45.7  $  1.83     46.4
Earnings per
 share -
 diluted     $  2.32  $  1.83     26.8  $  2.66     45.4  $  1.82     46.2
             -------  -------  -------  -------  -------  -------  -------


e) Fourth quarter Fiscal 2011 percentage change in underlying results
compared to fourth quarter Fiscal 2010 as reported and at constant exchange
rates


                                                                  13 weeks
                                                                     ended
                                                       13 weeks    January
                                                          ended   29, 2011
                                      13 weeks          January     under-
                                         ended              30,     lying
                                       January           2010 at  change at
                                       29, 2011  Under-  constant constant
              13 weeks 13 weeks         under-   lying   exchange  exchange
                 ended    ended         lying   change     rates    rates
               January  January         (non-    (non-     (non-    (non-
              29, 2011 30, 2010  Change  GAAP)    GAAP)     GAAP)    GAAP)
              $million $million    %   $million     %    $million     %
               -------  -------  -----  -------  -------  -------  -------
Sales by origin
 and destination:
US             1,007.0    914.0   10.2  1,007.0     10.2    914.0     10.2
UK               263.5    282.8   (6.8)   263.5     (6.8)   275.8     (4.5)
               -------  -------  -----  -------  -------  -------  -------
Total sales    1,270.5  1,196.8    6.2  1,270.5      6.2  1,189.8      6.8
               -------  -------  -----  -------  -------  -------  -------

Operating
 income/(loss):
US               167.9    121.5   38.2    167.9     38.2    121.5     38.2
UK                55.3     60.4   (8.4)    55.3     (8.4)    59.0     (6.3)
Unallocated      (12.7)    (4.7) 170.2    (12.7)   170.2     (4.6)   176.1
               -------  -------  -----  -------  -------  -------  -------
Total operating
 income          210.5    177.2   18.8    210.5     18.8    175.9     19.7
               -------  -------  -----  -------  -------  -------  -------

Income before
 income taxes    159.6    169.7   (6.0)   207.1     22.0    168.4     23.0
               -------  -------  -----  -------  -------  -------  -------

Net income       105.4    115.5   (8.7)   134.9     16.8    114.6     17.7
               -------  -------  -----  -------  -------  -------  -------

Earnings per
 share - basic $  1.23  $  1.35   (8.9) $  1.57     16.3  $  1.34     17.2
Earnings per
 share -
 diluted       $  1.21  $  1.34   (9.7) $  1.55     15.7  $  1.33     16.5
               -------  -------  -----  -------  -------  -------  -------

The underlying results are the results adjusted for the $47.5 million Make
Whole Payment in the 13 weeks ended January 29, 2011.



f) Free cash flow


                                                        Fiscal     Fiscal
                                                          2011       2010
                                                      $million   $million
                                                      ---------  ---------
Net cash provided by operating activities                 323.9      515.4
Net cash used in investing activities                     (55.6)     (43.5)
                                                      ---------  ---------

Free cash flow, including Make Whole Payment              268.3      471.9
Make Whole Payment                                         47.5         --
                                                      ---------  ---------

Free cash flow, excluding Make Whole Payment              315.8      471.9
                                                      ---------  ---------

Contact Information

  • Inquiries:
    Mike Barnes
    Chief Executive Officer
    Signet Jewelers
    +1 (441) 296 5872

    Ron Ristau
    Chief Financial Officer
    Signet Jewelers
    +1 (441) 296 5872

    Press:
    Alecia Pulman
    ICR, Inc.
    +1 (203) 682 8224

    Jonathan Glass
    Brunswick
    +44 (0)20 7404 5959