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Michael Hill sales growth weighed down by Australia

BUSINESSDESK: Michael Hill International, the listed jewellery chain, says full-year same-store sales edged up 0.3% as revenue in its largest market of Australia continues to shrink.

Same-store sales, which measures outlets open at least 12 months, fell to $473 million in the 12 months ended June 30, from $487.9 million a year earlier, the company said.

Total sales rose 4.6% to $510 million.

"While the past 12 months has had its challenges, especially in our largest market in Australia, the directors are satisfied with the overall performance of the group and in particular the growth achieved in New Zealand, Canada and the United States," chairman Sir Michael Hill said.

Same-store sales in the US rose 11.7% to about $12 million, followed by New Zealand, up 7.3% to $106 million, and Canada rising 0.7% to $45 million. Sales in Australian decreased 3.2% to $308 million.

The company’s professional care plan, which offers maintenance and repairs on jewellery, recorded a 131% increase in sales to about $27 million in the latest 12 months.

"Professional care plan sales continue to contribute positively to the company’s cashflow," Sir Michael said.

"The revenue from these plans is carried on the balance sheet as deferred revenue and is then brought to income over the life of the plans”, which are for three years or lifetime.

The jewellery maker's full-year results for the 12 months ended June 30 will be released on August 17.

Its shares are currently unchanged on 99 cents. They have gained about 12% this year.