• Comparable EBIT expected in $22.5m to $24m range (FY24H1: $31.3m)
• Group sales down 1% to $359.1m (FY24H1: $362.7m)
• Gross margin expected at 61-61.5% (FY24H1: 61.5%, FY24: 60.6%)
• Digital sales 8% of total group sales

Michael Hill International Limited (ASX/NZX: MHJ) has provided a trading update for the 26-week period ended 29 December 2024. The company faced prevailing macroeconomic pressures that continued to impact consumer sentiment and discretionary retail trading conditions throughout 2024, with conditions in New Zealand particularly challenging. Comparable EBIT for FY25H1 is anticipated to be in the range of $22.5m to $24m, compared to $31.3m in the prior corresponding period. Group sales were $359.1m, down 1% on the prior year and flat on a constant currency basis. On a same store sales basis, Canada delivered another record sales performance with +2.7% growth, Australia was up +0.6%, while New Zealand continued to be adversely impacted, down -7.8%. The company's product and brand initiatives, including the successful launch of the new 'Pendant Bar' concept and 'LAB.' offering, are continuing to underpin the improving gross margin, which is expected to be in the range of 61% to 61.5% for the half, demonstrating momentum in margin recovery. Digital sales have continued to grow, representing 8% of total group sales for the half. The company has also identified targeted initiatives to deliver ~$5m of cost reductions in the second half as it aligns resources to its strategic priorities and trading performance. The group network stood at 294 stores at the end of the half across all markets.

Comparable EBIT for FY25H1 is expected to be in the range of $22.5m to $24m.

The strong performance trend observed in the first three months of the half has re-emerged through December and January, with the first few weeks of January showing signs of strong positive sales momentum, particularly in Canada.