Michael Hill International (MHJ) H2 2025 earnings summary

Executive summary

• FY2025 revenue was $644 million, broadly flat year-over-year, with gross margin at 60.5% despite record gold prices and aggressive promotions; Canada delivered record sales and Australia saw growth in the second half, while New Zealand declined.

• Statutory net profit after tax improved to $2.1 million from a $0.5 million loss, aided by a $3.0 million favorable litigation outcome and offset by a $7.4 million non-cash impairment of the Bevilles brand.

• Digital sales grew 6% to over $50 million, supported by omnichannel initiatives.

• Store network rationalization continued, reducing to 287 stores (from 300), with 14 closures and two conversions to Bevilles.

• New initiatives included opening a second global flagship store in Melbourne, refurbishing the Queenstown store, launching the Pendant Bar concept, and introducing certified sustainable lab diamonds.

Financial highlights

• Group revenue was $644 million, flat year-over-year; gross margin was 60.5%, slightly down from 60.6%.

• Comparable EBIT was $15.3 million, down from $15.9 million year-over-year.

• Net debt at year-end was $41.9 million, up from $38.7 million, and inventory increased to $199 million.

• Basic EPS was 0.55c, up from -0.12c; cash flow from operations was $55.1 million, up from $37.8 million.

• No final dividend declared for FY2025 due to compressed earnings.

Outlook and guidance

• Early FY2026 trading shows group same-store sales up 3.2% year-over-year, with Australia up 3.4%, Canada up 6.8%, and New Zealand down 3.2%.

• Focus remains on margin recovery, operational discipline, and a strategic reset under the new CEO commencing August 2025.

• No dividend planned for FY26 as prudent investment and cost control continue.