Michael Hill closes six stores, axes senior managers amid tough retail environment

Well-known jewellery chain Michael Hill has revealed it closed six stores in the past six months and scrapped senior management roles due to tough retail conditions.

In a trading update released by the stock market listed company, it described the six months to December 31, 2023 as a “challenging period for the business” as its profitability took a hit and is estimated to be down 45 to 39 per cent on the same period of 2022.

Of the six “underperforming” stores it closed, one was in regional WA, one in Queensland, one in Victoria, two in NSW and one in Canada.

In the statement, the company blamed economic conditions for “impacting consumer sentiment”, adding that its profit margin was affected by the inflated cost of gold and diamonds, and “aggressive competitor behaviour”, which led to a decision to “reduce operating costs, including the exit of a number of senior management roles”.

It did not reveal how many staff or which roles were affected.

Michael Hill also owns the more affordable Bevilles chain.

The company achieved sales of $362.8 million during the six months to December 31, 2023, which was up 4.1 per cent on the same period of 2022.

But it revealed its gross profit for the period was expected to be between $30-33 million, which represents a fall of 45 to 39 per cent from the gross profit of $54.5 million it posted in the second half of 2022.

Earlier in 2023 the company bought the more affordable Bevilles jewellery chain, and it opened four new Bevilles stores in Australia during the past six months.

Michael Hill CEO and managing director Daniel Bracken said profit margins were hit in the second half of 2023. Picture: Richard Walker.

Source: news.com.au

Michael Hill Plans to Expand Bevilles Throughout Australia

Michael Hill expects to open new Bevilles stores across Australia following its acquisition of the jeweler, with some locations to launch before the holidays.

“I am excited by the addition of Bevilles to the Michael Hill portfolio of brands, and our early insights only reinforce its complementary strategic fit and reaffirms the opportunity to grow the Bevilles brand and take its offering nationally,” Michael Hill CEO Daniel Bracken said last week. “Discussions are already well advanced to secure new store locations to open prior to Christmas and for entry into a new state market in the new year.”

The Australia-based retailer bought the 26-branch Bevilles in April for AUD 45.1 million ($30 million). It plans to take the jewelry chain international, with the hopes of achieving 80 shops across Australia, New Zealand and Canada by 2028.

Group revenue increased 6% to AUD 628.1 million ($423.7 million) for the full fiscal year that ended July 2. Sales in Australia grew 9% to AUD 331 million ($222.9 million) and were up 6% in New Zealand to NZD 132.4 million ($82 million). In Canada, revenue rose 0.4% to CAD 158.1 million ($119.7 million).

Michael Hill currently operates 172 stores in Australia, including Bevilles; 46 in New Zealand; and 86 in Canada.

Source: DCLA

Burgundy Diamond Mines Chief Exits

       Peter Ravenscroft. (Burgundy Diamond Mines)

Burgundy Diamond Mines managing director Peter Ravenscroft has resigned from the Australian company with immediate effect.

The board has appointed Kim Truter, who became nonexecutive chairman of the miner in December 2021, as interim CEO, Burgundy said last week.

Truter has over 30 years of experience in the alluvial and underground mining sector. He has also held executive positions at De Beers in Canada and with Rio Tinto’s diamond unit in Australia.

Meanwhile, Michael O’Keefe, who has been a nonexecutive director since 2017, will take over as executive chairman. He is the former CEO and current executive chairman of Champion Iron, which operates an iron-ore project in Canada. Burgundy has not announced whether it is looking for a long-term successor for Ravenscroft.

Source: Diamonds.net

Lucapa acquires Merlin diamond project in Australia

  Merlin diamond mine in Australia’s Northern Territory.

Lucapa Diamond announced that it has entered into a binding asset sale agreement for the acquisition of a 24km2 mining lease and a 283km2 exploration tenement encompassing the mining lease and associated equipment and assets the Merlin Assets from Merlin Operations Pty.

Merlin Operations is a wholly-owned subsidiary of Merlin Diamonds Limited, which is in liquidation. The Merlin Tenements are located in the Northern Territory of Australia, approximately 720km southeast of Darwin.

Merlin is home to Australia’s largest mined rough diamond on record and has the potential to be the
only producing diamond mine in Australia, following the closure of Rio Tinto’s iconic Argyle mine in 2020, after 37 years in production.

The strategic acquisition is supported by a A$20 million ($15.5m) private placement plus a share purchase plan to raise up to A$3 million ($2.3m).

The acquisition price of A$8.5m cash represents a ~A$2/ carat multiple on Merlin’s existing 4.4m
carat JORC compliant resource and complements Lucapa’s existing portfolio, the company said, adding a near-term development opportunity with an existing 4.4m carat mineral resource estimate in Australia to Lucapa’s two existing producing assets in Angola and Lesotho.

The ~300km2 tenement package also comes with significant exploration upside, Lucapa said, through over 70 unresolved anomalies in areas where all kimberlite discoveries have been diamondiferous.

Source: DCLA

Lucapa acquires Merlin diamond project in Australia

  Merlin diamond mine in Australia’s Northern Territory.

Lucapa Diamond announced that it has entered into a binding asset sale agreement for the acquisition of a 24km2 mining lease and a 283km2 exploration tenement encompassing the mining lease and associated equipment and assets the Merlin Assets from Merlin Operations Pty.

Merlin Operations is a wholly-owned subsidiary of Merlin Diamonds Limited, which is in liquidation. The Merlin Tenements are located in the Northern Territory of Australia, approximately 720km southeast of Darwin.

Merlin is home to Australia’s largest mined rough diamond on record and has the potential to be the
only producing diamond mine in Australia, following the closure of Rio Tinto’s iconic Argyle mine in 2020, after 37 years in production.

The strategic acquisition is supported by a A$20 million ($15.5m) private placement plus a share purchase plan to raise up to A$3 million ($2.3m).

The acquisition price of A$8.5m cash represents a ~A$2/ carat multiple on Merlin’s existing 4.4m
carat JORC compliant resource and complements Lucapa’s existing portfolio, the company said, adding a near-term development opportunity with an existing 4.4m carat mineral resource estimate in Australia to Lucapa’s two existing producing assets in Angola and Lesotho.

The ~300km2 tenement package also comes with significant exploration upside, Lucapa said, through over 70 unresolved anomalies in areas where all kimberlite discoveries have been diamondiferous.

Source: DCLA