Retirement plans

6 Months Ended

Jul. 29, 2023

Retirement Benefits [Abstract]

Retirement plans

Retirement plans

Signet provided a defined benefit pension plan in the UK (the “Pension Scheme”) to participating eligible employees. The Pension Scheme ceased to admit new employees effective April 2004. In September 2017, the Company approved an amendment to freeze benefit accruals under the Pension Scheme in an effort to reduce anticipated future pension expense. As a result of this amendment, the Company froze the pension plan for all participants with an effective date of October 2019 as elected by the plan participants. All future benefit accruals under the plan ceased as of that date.

On July 29, 2021, Signet Group Limited (“SGL”), a wholly-owned subsidiary of the Company, entered into an agreement (the “Agreement”) with Signet Pension Trustee Limited (the “Trustee”), as trustee of the Pension Scheme, to facilitate the Trustee entering into a bulk purchase annuity policy ("BPA") securing accrued liabilities under the Pension Scheme with Rothesay Life Plc ("Rothesay") and subsequently, to wind up the Pension Scheme. The BPA is held by the Trustee as an asset of the Pension Scheme (the "buy-in") in anticipation of Rothesay subsequently (and in accordance with the terms of the BPA) issuing individual annuity contracts to each of the 1,909 Pension Scheme members (or their eligible beneficiaries) ("Transferred Participants") covering their accrued benefits (a full “buy-out”), following which the BPA will terminate and the Trustee will wind up the Pension Scheme (collectively, the “Transactions”).

Under the terms of the Agreement, SGL has contributed £15.0 million to date (approximately $20.1 million) to the Pension Scheme to enable the Trustee to pay for any costs incurred by the Trustee as part of the Transactions. The Company expects to contribute up to $1.0 million to the Pension Scheme in Fiscal 2024, subject to the level of remaining funding required for the completion of the Transactions described above, including the wind-up of the Pension Scheme.

On April 22, 2022, the Trustee entered into a Deed Poll agreement with Rothesay and a Deed of Assignment with SGL to facilitate the assignment of individual policies for a significant portion of the Transferred Participants (“Assigned Participants”). The Deed Poll and Deed of Assignment, collectively, irrevocably relieve SGL and the Trustee of its obligations under the policies to the Assigned Participants. As a result of the Deed Poll and Deed of Assignment, the Company determined that a transfer of all remaining risks has occurred with respect to these groups of participants. Thus, management concluded that the Company triggered settlement accounting and performed a remeasurement of the Pension Scheme, which resulted in a non-cash, pre-tax settlement charge of $131.9 million recorded within other non-operating income (expense), net within the condensed consolidated statement of operations during the first quarter of Fiscal 2023.

In the second quarter of Fiscal 2023, as a result of additional voluntary lump sum distributions made from the Pension Scheme, the Company determined that a transfer of all remaining risks had occurred with respect to this group of participants. Thus, management concluded that the Company triggered settlement accounting which resulted in a non-cash, pre-tax settlement charge of $0.9 million recorded within other non-operating income (expense), net within the condensed consolidated statement of operations during the second quarter of Fiscal 2023.

In the first quarter of Fiscal 2024, the Company recorded an additional non-cash, pre-tax settlement charge of $0.2 million within other non-operating income (expense), net within the condensed consolidated statement of operations. This charge was the result of the transfer of all remaining risks with respect to the final groups of participants from the Pension Scheme, which triggered settlement accounting.

The settlement charges recorded in Fiscal 2023 and Fiscal 2024 relate to the pro-rata recognition of previously unrecognized actuarial losses and prior service costs out of AOCI and into earnings associated with the buy-out of the benefit obligation. No further amounts remain unrecognized in AOCI as of July 29, 2023.

The components of net periodic benefit cost for the Pension Scheme are as follows:

	13 weeks ended				26 weeks ended
(in millions)	July 29, 2023		July 30, 2022		July 29, 2023		July 30, 2022
Components of net periodic benefit cost:
Interest cost	$	—	$	—	$	—	$	(0.9)
Expected return on plan assets	(0.9)		(0.3)		(0.9)		0.3
Amortization of unrecognized actuarial losses	—		(1.1)		—		(2.0)
Amortization of unrecognized net prior service costs	—		(0.1)		—		(0.2)
Pension settlement loss	—		(0.9)		(0.2)		(132.8)
Total net periodic benefit cost	$	(0.9)	$	(2.4)	$	(1.1)	$	(135.6)

All components of net periodic benefit cost are charged to other non-operating income (expense), net, in the condensed consolidated statements of operations.