Michael Hill International (MHJ) H2 2025 earnings summary

Executive summary

• FY2025 saw global economic uncertainty and challenging retail conditions, especially in New Zealand, while Canada delivered record sales and Australia achieved growth in the second half.

• Group revenue was $644 million, broadly flat year-over-year, with gross margin at 60.5% amid record gold prices and promotional activity.

• Digital sales grew 6% to over $50 million, supported by omnichannel initiatives and surpassing $50 million for the first time.

• Store network rationalization continued, reducing to 287 stores from 300, with 14 loss-making stores closed and two new stores opened.

• Leadership changes included the passing of the founder and CEO, with a new CEO appointed.

Financial highlights

• Group revenue was $644 million, flat year-over-year; gross margin at 60.5%, unchanged year-over-year.

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

• Year-end inventory was $199 million; net debt at year-end was $42 million, both broadly in line with prior year.

• No final dividend declared for FY2025 due to compressed earnings and focus on investment.

• Statutory net profit after tax improved to $2.1 million from a $0.5 million loss, including a $7.4 million Bevilles Brand impairment and a $3.0 million favorable litigation outcome.

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%.

• Total group sales increased 3.0% in the same period.

• Focus remains on margin recovery, operational discipline, and strategic review under new CEO.

• Board remains cautious on capital returns, prioritizing prudent investment.