Michael Hill International pleased the market yesterday when its six-month trading update and profit guidance met forecasts.
Total same-store sales were up 9.8% to $260.8 million in the six months to December 331 and total all-stores sales were up 9.9% to $268.7 million.
Chairman Michael Hill said sales in the second quarter, including the key Christmas trading period, held up well with same-store growth of 7.7% achieved for the quarter.
"The directors are especially pleased to see sales in Canada and the United States bounce back after tough trading conditions since late 2007. However, retail conditions remain difficult in North America."
Half-year earnings before interest and tax (ebit) for the group was expected to be in the range of $32 million to $34 million compared with $30.3 million in the previous corresponding period, he said.
The full half-year results were due to be released to the NZX on February 17, Mr Hill said.
Forsyth Barr broker Suzanne Kinnard said MHI had produced good trading numbers that were in line with forecasts.
"There was an encouraging performance from the remaining US stores, although the company has stated that trading conditions still remain difficult in North America."
The Forsyth Barr first-half ebit forecast was $33.7 million, which was at the high end of the guidance provided by the company. The stock was still rated as an "accumulate", she said.
Late last year, Mr Hill, through an Australian company, sought to buy a controlling stake in the company that bore his name.
Durante Holdings, a wholly owned subsidiary of one of the Hill family trusts, wanted to buy 5% of the shares it did not own to take its holding to 50.2%.
MHI shares rose yesterday to 90c, the offer price from Durante. Last calendar year, the shares traded between 85c and 64c.
Brokers said it appeared as though Mr Hill had lost patience with some shareholders, telling them they needed to take a longer view of the stock.
He had become frustrated with comments made about the overseas expansion plans that had not worked out as expected.
