Michael Hill Reports Strong Profit Growth, Plans Dividend Return

Michael Hill International has reported significant growth in profitability and sales during the first half of the financial year 2026. The jeweller, which operates across New Zealand, Australia, and Canada, saw its sales revenue rise by 3% to $370 million, while after-tax profits surged by 32% to $22.2 million for the period ending December 29.

Sales in Canada were particularly strong, contributing to a record increase of over 6% during the period. In Australia, sales grew by 4.8%, and local sales improved by 1.8%. Despite this positive performance, the board opted not to declare a dividend at this time, indicating plans to return to dividend payments at the full-year results.

Jonathan Waecker, the newly appointed Chief Executive Officer, noted that the company experienced a “materially stronger operating performance” during the first half. This improvement was linked to higher sales volumes, which generated an additional $6.3 million in gross profit. Waecker highlighted that renewed marketing initiatives and pricing strategies helped offset ongoing pressures from elevated input costs in precious metals, particularly gold.

Discipline in cost management also played a crucial role, as the company effectively controlled operating expenses in a challenging inflationary environment. This approach enhanced operating leverage and contributed to the overall improvement in earnings.

Strategic Focus on Operational Efficiency

In addition to these financial gains, Michael Hill undertook several working capital initiatives over the past six months. This included negotiating new supplier terms with a key partner and focusing on improving stock efficiency. As a result, inventory holdings decreased by $11.3 million to $201.9 million.

Looking ahead, Waecker expressed awareness of the current economic landscape but emphasized that the first half results demonstrate that consistent execution of retail fundamentals is translating into improved performance for the group. He stated, “At our Investor Day in April, we will provide clarity on how the business will build on its current trading momentum and deliver sustainable, profitable growth over time.”

Rob Fyfe, Chair of Michael Hill, reiterated the board’s commitment to restoring a consistent and sustainable dividend for shareholders. He noted that the board intends to return to dividend payments at the full-year results, contingent on the continuation of favorable trading conditions.

As Michael Hill navigates its strategic direction under new leadership, the company’s strong financial results and commitment to operational efficiency position it well for future growth and stability.