Michael Hill to Exit US Market

RAPAPORT... Michael Hill will close its US operations after a run of disappointing sales results in the "challenging" and "loss-making" market, the Australia-based jeweler said Wednesday. "Our time in the highly competitive US jewelry market taughtus a lot and helped to strengthen our core business, including the developmentof our bridal-collection strategy," said CEO Phil Taylor. "However, our US operations have notgained sufficient traction in recent years, and the level of capital required toscale up the business is not warranted under current trading conditions." The company has struggled in the US sincelaunching there in 2008, despite its investment in its business model, newmarketing initiatives and efforts to increase brand awareness, Taylor said. Its US sales fell 15% in the six months ending December 31. Michael Hill intends to refocus the capital earmarked for USoperations to parts of the company that show the highest returns andgrowth potential. The group has 172 stores in Australia, 53 in New Zealand and83 in Canada, which the jeweler said are performing strongly and account for95% of its revenue. The company will continue to operate its nine US storesas it negotiates its exit.