Michael Hill International shares were upgraded yesterday by Forsyth Barr from hold to accumulate after the release of the jewellery retailer's nine-month sales figures.
Total all-store sales for the nine months ending March were $372.3 million, up 9% on the $341.7 million reported in the previous corresponding period.
Australian all-store sales rose 10.5% in the quarter to $250.8 million; New Zealand store sales rose 4.7% to $77.6 million; Canadian store sales rose 22.1% to $35.8 million; and United States store sales fell 28.2% to $8 million.
There were 17 stores trading in the US last year compared with nine stores this year.
Group chairman Sir Michael Hill said sales in the third quarter held up well, with "same-store" growth of 5.7% for the quarter, giving the group a "same-store" sales improvement of 8.6% in the period, despite the negative effects of the natural disasters in Queensland and Christchurch during the quarter.
The directors were "especially pleased" to see continued same-store sales growth in Canada and the US - 13.5% and 13.5% respectively.
Forsyth Barr broker Suzanne Kinnaird said the slower sales growth was expected and she had made only minor changes to her forecasts.
With Michael Hill International trading about 10% below valuation, Forsyth Barr upgraded its recommendation on shares.
The group made no additional comment on the $45 million earnings before interest and tax guidance given in the first half, which presumably remained in place, she said. Forsyth Barr retained its valuation of 98c per share. It last traded at 89c.
