Segment information

6 Months Ended

Aug. 01, 2020

Segment Reporting [Abstract]

Segment information

Segment information

Financial information for each of Signet’s reportable segments is presented in the tables below. Signet’s chief operating decision maker utilizes segment sales and operating income, after the elimination of any inter-segment transactions, to determine resource allocations and performance assessment measures. Signet manages its business as three reportable segments: North America, International, and Other. Signet’s sales are derived from the retailing of jewelry, watches, other products and services as generated through the management of its reportable segments. The Company allocates certain support center costs between operating segments, and the remainder of the unallocated costs are included with the corporate and unallocated expenses presented. In addition, beginning in Fiscal 2021, the Company allocates restructuring costs (further described in Note 5) to the operating segment where these charges were incurred, and the presentation of such costs has been reflected consistently in all periods presented.

The North America reportable segment operates across the US and Canada. Its US stores operate nationally in malls and off-mall locations principally as Kay (Kay Jewelers and Kay Jewelers Outlet), Zales (Zales Jewelers and Zales Outlet), Jared (Jared The Galleria Of Jewelry and Jared Vault), James Allen and Piercing Pagoda, which operates through mall-based kiosks. Its Canadian stores operate as the Peoples Jewellers store banner. The segment also operates a variety of mall-based regional banners.

The International reportable segment operates stores in the UK, Republic of Ireland and Channel Islands. Its stores operate in shopping malls and off-mall locations (i.e. high street) principally as H.Samuel and Ernest Jones.

The Other reportable segment consists of subsidiaries involved in the purchasing and conversion of rough diamonds to polished stones.

	13 weeks ended				26 weeks ended
(in millions)	August 1, 2020		August 3, 2019		August 1, 2020		August 3, 2019
Sales:
North America segment	$	823.0	$	1,241.0	$	1,604.1	$	2,541.3
International segment	61.0		113.9		125.9		225.4
Other segment	4.0		9.5		10.1		29.4
Total sales	$	888.0	$	1,364.4	$	1,740.1	$	2,796.1
Operating income (loss):
North America segment (1)	$	(57.0)	$	11.8	$	(291.2)	$	40.1
International segment (2)	(15.6)		(1.6)		(54.2)		(10.6)
Other segment (3)	(0.2)		(9.1)		(0.5)		(12.9)
Corporate and unallocated expenses (4)	(16.9)		(23.5)		(43.4)		(41.6)
Total operating income (loss)	(89.7)		(22.4)		(389.3)		(25.0)
Interest expense	(9.4)		(10.1)		(16.5)		(19.3)
Other non-operating income, net	0.2		0.2		0.3		0.5
Income (loss) before income taxes	$	(98.9)	$	(32.3)	$	(405.5)	$	(43.8)

⁽¹⁾ Operating income (loss) during the 13 and 26 weeks ended August 1, 2020 includes a $0.2 million and $0.6 million benefit, respectively, recognized due to a change in inventory reserves previously recognized as part of the Company’s restructuring activities. Additionally, operating income (loss) during the 13 and 26 weeks ended August 1, 2020 includes charges of $27.7 million and $36.6 million, respectively, primarily related to severance, professional fees and store closure costs recorded in conjunction with the Company’s restructuring activities. Operating income (loss) during the 13 and 26 weeks ended August 1, 2020 also includes asset impairment charges of $17.5 million and $135.4 million, respectively. Operating income (loss) during the 13 and 26 weeks ended August 3, 2019 includes a $47.7 million out-of-period goodwill adjustment. In addition, operating income (loss) during the 13 and 26 weeks ended August 3, 2019 includes $1.7 million and $1.2 million, respectively, related to inventory charges recorded in conjunction with the Company’s restructuring activities. Operating income (loss) during the 13 and 26 weeks ended August 3, 2019 includes charges of $12.4 million and $32.2 million, respectively, primarily related to severance, professional fees and store closure costs recorded in conjunction with the Company’s restructuring activities. See Note 5, Note 13, and Note 15 for additional information.

⁽²⁾ Operating income (loss) during the 13 and 26 weeks ended August 1, 2020 includes charges of $1.0 million and $4.6 million, respectively, related to severance and store closure costs recorded in conjunction with the Company’s restructuring activities. Additionally, operating income (loss) during the 13 and 26 weeks ended August 1, 2020 includes asset impairment charges of $2.8 million and $21.2 million, respectively. Operating income (loss) during the 13 and 26 weeks ended August 3, 2019 includes charges of $0.6 million and $1.6 million, respectively, related to severance and store closure costs recorded in conjunction with the Company’s restructuring activities. See Note 5, Note 13, and Note 15 for additional information.

⁽³⁾ Operating income (loss) during the 13 and 26 weeks ended August 3, 2019 include charges of $2.7 million and $3.2 million, respectively, related to charges recorded in conjunction with the Company’s restructuring activities including inventory charges. See Note 5 for additional information.

⁽⁴⁾ Operating income (loss) during the 13 and 26 weeks ended August 1, 2020 includes a credit of $1.0 million and a net charge of $7.5 million, respectively, related to the settlement of previously disclosed shareholder litigation matters, inclusive of expected insurance proceeds. Operating income (loss) during the 13 and 26 weeks ended August 1, 2020 includes charges of $0.2 million and $0.4 million, respectively, primarily related to severance and professional services recorded in conjunction with the Company’s restructuring activities. Operating income (loss) during the 13 and 26 weeks ended August 3, 2019 include charges of $10.4 million and $16.4 million, respectively, related to charges recorded in conjunction with the Company’s restructuring activities. See Note 5 and Note 21 for additional information.