Released: 28/03/2000

HIGHLIGHTS

Record profits for Signet

• Group profit before tax: £127.7m (1998/99: £89.2m) up 43%

• Group sales: £1,136.5m +15% (1998/99: £991.2m), like for like up 9%

• Earnings per share: 5.3p (1998/99: 3.9p) up 36%

• Proposed final dividend: 1.2p (1998/99: 1.0p) up 20%

• Appointment of Terry Burman as Group Chief Executive

"We are delighted to have achieved a year of record profits. The expanding US business again outperformed its main competition recording a fifth year of significant profits growth. The UK also posted a substantial increase in results in what was a very challenging year for much of the retail sector. The Group is now in excellent shape and the Board is confident that the operating strategies in place on both sides of the Atlantic provide a sound basis for further growth.

I am extremely pleased that Terry Burman is taking over as Chief Executive at this time. We have worked closely together for almost five years and I have no doubt that he is the right man to lead the Group through the next phase of its development. I wish him every success."

Terry Burman, newly appointed Group Chief Executive, said:

"I am grateful to the Board for their vote of confidence in appointing me Group CEO. James McAdam has built an excellent record of consistent improvement and superior results. I look forward to working with my executive colleagues in responding to the opportunity to further build the business.

Enquiries:	James McAdam, Chairman	+44 (0) 20 7404 5959
	Terry Burman, Group and US Chief Executive	+44 (0) 20 7404 5959
	Walker Boyd, Finance Director
	Susan Gilchrist/ Fiona Antcliffe, Brunswick	+44 (0) 20 7404 5959

Signet, the world's largest specialist jewellery retailer operates 1,433 stores. These include 827 stores in the US, where the Group trades as "Kay Jewelers", "Jared - The Galleria of Jewelry" and under a number of regional names and 606 stores in the UK, where the Group trades as "H. Samuel", "Ernest Jones" and "Leslie Davis".

Preliminary Results Statement

Results
The Group had a very successful year and is delighted to report record sales and profits. In the 52 weeks to 29 January 2000 profit before tax rose by 43.2% to £127.7 million (1998/99: £89.2 million) with earnings per share of 5.3p (1998/99: 3.9p). Sales advanced by 14.7% to £1,136.5 million (1998/99: £991.2 million), the like for like increase being 9.1%.

Group operating profit rose by 36.0% to £139.1 million (1998/99: £102.3 million), reflecting an operating margin of 12.2% (1998/99: 10.3%). The return on capital employed was 24.1% (1998/99: 19.5%).

The US business, which accounts for over two thirds of Group sales, continued to demonstrate its underlying strengths with a further industry leading performance, building on its consistent record of growth in recent years. The expansion programme continues; 10% was added to selling space during the year comprising 41 new mall stores (offset by 15 store closures) and 13 new Jared off-mall superstores.

The UK Jewellery division also produced a significant increase in results in what was a very challenging year for the retail sector in general. Following a difficult first quarter, business gradually picked up during the year as the trading environment improved and a series of operational initiatives began to bear fruit. Sales over the important Christmas period were particularly strong, helped by a marked resurgence of consumer confidence in the jewellery sector and by the Millennium factor.

Dividends
Against the background of a good year the Board is pleased to recommend a final dividend of 1.2p per share (1998/99:1.0p). This will be in addition to the interim dividend of 0.25p per share declared in September making a total dividend for the year of 1.45p per share (1998/99:1.0p).

Management
The Board is also pleased to announce, with immediate effect, the appointment of Terry Burman as Chief Executive of Signet Group plc. Terry Burman has been Chief Executive of the Group's US business since 1995 and will retain this role in addition to his new appointment.

In order to ensure a smooth transition to Terry Burman of executive responsibility, James McAdam will remain as Executive Chairman until 31 March 2001 from which date the Board has asked him to continue for a period as Chairman in a non-executive capacity.

Prospects
The Group has now achieved five years of consistent and significant profits growth. The improvement in trading performance has transformed the financial standing of the Group and generated the resources necessary to finance the present strategy. In the last two years alone £139.5 million has been invested in the fixed and working capital needs of the business. At the same time the Group has funded £20.9 million of dividends and reduced net debt by £66.3 million. By 29 January 2000 gearing had fallen to 20%. The present strength of the balance sheet should not only enable the Group to fund existing investment plans but also allow it to consider any opportunities that might arise from further consolidation of the jewellery industry. The Board is confident that the progress made in recent years, together with the strategies in place on both sides of the Atlantic, provides a sound basis for further growth.

Current Trading
The Group has experienced a favourable start to the year, helped by strong sales over the Valentine Day period in both the US and the UK. Sales performance for the first quarter of the year will be announced in the first week of May.

Operating Reviews

US (67% of sales)
The US business maintained its strong performance and again outperformed its main quoted competitors on a range of key operating measures including like for like sales growth. Sales per store increased to an average of over $1.5 million (1998/99: $1.3 million). Details of the performance are set out below:

		1999/00		1998/99		Change		Like for Like change
		£m		£m		%		%
Sales		759.8		637.2		+19.2 (a)		+11.3
Operating Profit		103.1		77.5		+33.0
Operating margin %		13.6		12.2
ROCE %		24.9		20.4
(a) At constant exchange rates US total sales increased by 16.4%.

Total space was some 10% greater with 827 stores in total at 29 January 2000, comprising 545 Kay stores, 254 regional stores and 28 Jared stores (30 January 1999: 788 stores comprising 524 Kay stores, 249 regional stores and 15 Jared stores). The Jared concept continues to perform ahead of expectations and 13 new stores were added during the year. In the year 29 Kay stores and 12 regional stores were opened with 57 mall stores refurbished or relocated and 15 mall stores closed in the normal course of business.

The careful testing of new products, the development of product ranges, and the aggressive roll out of proven winners was again very successful. This helped the division achieve a lower inventory to sales ratio than any of its quoted competitors. The diamond range was further improved with bridal and large solitaire rings, solitaire earrings, bezel set earrings and pendants, as well as bracelets, being particularly successful. Gross margins were maintained at last year's level.

Spending on advertising and marketing increased by 15%. There was a further switch to television and radio advertising and away from catalogues, with television impressions increasing by 50% and radio impressions by 20%. Retargeting of advertising to peak selling periods again worked well and helped drive the fourth quarter like for like sales increase of 12.7%.

Kay's web site continues to be developed with additional product information, downloadable promotions and a credit application facility being new features which are essential to the development of a site for future e-commerce transactions. The strength of the Kay brand name and its national store coverage would provide the division with a competitive advantage in any future e-commerce activity.

In the US the strategy is to enhance the existing business by building on its competitive advantages in merchandising, marketing and store operations, to take advantage of relocation and refurbishment opportunities and to increase the store portfolio by opening further mall stores and rolling out the successful Jared off mall concept. A further increase of about 10% in selling space is planned for 2000/01, comprising an additional 40 new mall stores (offset by 15 store closures) and up to an additional 15 Jared stores. Target markets have been identified which would bring the potential for the Jared concept to over 200 stores, with total sales of over $1 billion.

UK (33% of sales)
The UK Jewellery division achieved excellent results helped by the surge in consumer confidence in the fourth quarter and by operational initiatives implemented in the year. Gross margins were above last year's level. Details of the performance are set out below:

		1999/00		1998/99		Change		Like for Like change
		£m		£m		%		%
Sales
H. Samuel		245.4		237.9		+3.2		+2.1
Ernest Jones		125.7		109.4		+14.9		+11.0
Other		5.6		6.7
Total		376.7		354.0		+6.4		+4.9
Operating Profit		39.3		32.4		+21.3
Operating margin %		10.4		9.1
ROCE %		25.9		21.6

The division performed particularly well in the fourth quarter with a like for like sales increase of 11.7% (H. Samuel +7.2% and Ernest Jones +21.6%).

During the year greater focus was placed on the core diamond product category and this was reflected in significant sales increases in both H. Samuel and Ernest Jones. Improvements in the product range and updated window displays also contributed to the better performance in this product area. Watch sales were buoyant, particularly the new fashion watch brands and the higher value items in the Ernest Jones range. Greater emphasis was given in both chains to improving product displays and in-store presentational standards. These operational improvements were backed by a strengthening of the supply chain logistics as well as an improved marketing and promotional programme that benefited from the increased interaction with the US business.

Customer service standards were further improved and continue to be a priority. Clear objectives have been set and revised training programmes are in place with the aim of further improving product knowledge, service and selling skills. In H. Samuel regional, area and training structures have been strengthened to provide greater depth of field support. The success of the drive to simplify field operating procedures within stores is resulting in more time now being spent by store staff attending to customers rather than on administrative tasks. A better focused incentive programme has also been introduced.

The year saw further investment in the store portfolio, particularly in Ernest Jones where 40 store refurbishments were carried out. Seven H. Samuel and four Ernest Jones new store openings took place during the year. At 29 January 2000 there were 606 stores in total (427 H. Samuel stores and 179 Ernest Jones stores).

The web sites for both H. Samuel and Ernest Jones were further improved and expanded. The division is actively assessing current developments in e-commerce and digital television marketing.

H. Samuel is a high volume business with a relatively low transaction value. It is positioned in the heart of the mass market and is already well represented nationwide. The strategy is therefore to leverage the strong market position of the business by making existing space work harder. This will be done by intensifying the present drive to improve customer service and by continuing to increase the participation of products such as diamonds, gemstones and fashion watches in the range.

For Ernest Jones there are greater opportunities to expand space and to develop further the Leslie Davis name. Both Ernest Jones and Leslie Davis are well positioned to capitalise on the trend towards more aspirational products, particularly in the diamond and watch categories.

The UK division has significantly increased its presence in the insurance loss replacement business, serving a growing list of leading insurance companies and their clients. This business is a key strategic opportunity, particularly for Ernest Jones. A strengthening of management and systems support is underway to further facilitate the growth of this business.

Financial Review

EBITDA
The US achieved an EBITDA of £118.7 million (1998/99: £92.7 million) and the UK £51.3 million (1998/99: £45.0 million) before charging Group central costs of £3.3 million (1998/99: £7.6 million). EBITDA to sales ratios increased to 15.6% in the US (1998/99: 14.6 %) and to 13.6% in the UK (1998/99: 12.7%).

Return on capital employed
The Group's ROCE increased to 24.1% (1998/99: 19.5%) - US 24.9% (1998/99: 20.4%); UK 25.9% (1998/99: 21.6%). US capital employed includes the in-house credit card debtors amounting to £220.1 million at 29 January 2000 (30 January 1999: £194.0 million).

Depreciation and capital expenditure
Depreciation charges were £27.8 million (1998/99: £27.6 million) - £15.6 million in the US (1998/99: £14.9 million) and £12.2 million in the UK (1998/99: £12.7 million). Capital expenditure in the US was £27.4 million (1998/99: £16.5 million) and in the UK was £11.9 million (1998/99: £14.4 million).

Group costs
Group central costs were £3.3 million (1998/99: £7.6 million). In 1999/00 the figure includes a gain on the disposal of properties of £2.1 million. The figure for 1998/99 included a charge of £2.1 million as a result of an increase in property provisions, largely offset by a gain on disposal of properties of £1.9 million.

Net interest payable and similar charges
Net interest payable and similar charges amounted to £11.4 million (1998/99: £13.1 million), a reduction of 13.0%. This reflected the lower level of net debt carried by the Group.

Taxation
The tax charge of £38.3 million (1998/99: £24.0 million) reflects the benefit of US tax losses brought forward and used against US taxable profits. The tax losses were fully utilised during 1999/00 and this was a major factor in the increase in the effective tax rate to 30.0% from 26.9%.

Summary of Fourth Quarter Results

		1999/00		1998/99		Like for like
						change
		£m		£m		%
Sales
UK		161.9		143.9		11.7
US		325.2		268.0		12.7
		487.1		411.9		12.3
Operating profit
UK - Trading		39.2		32.8
- Group central costs		(1.0)		(4.2)
		38.2		28.6
US		63.8		49.5
Total operating profit		102.0		78.1
Interest		(2.8)		(2.9)
Profit before tax		99.2		75.2
Taxation		(30.0)		(20.3)
Profit for the period		69.2		54.9
EPS - both basic and diluted		4.1p		3.3p

Liquidity and capital resources
Net debt at 29 January 2000 was £91.6 million, a reduction of £19.9 million in the year (30 January 1999: £111.5 million). Group gearing (that is the ratio of net debt to shareholders' funds) at the year-end was 20% (30 January 1999: 29%). Excluding the US securitisation facility of £118.2 million (1998/99: £116.8 million), the Group had net cash of £26.6 million at 29 January 2000 (30 January 1999: £5.3 million).

Operating activities generated £121.5 million (1998/99: £102.6 million) reflecting an increase in EBITDA offset by investment in working capital primarily due to the increase in the number of stores. Cash flow before investing activities was £78.2 million (1998/99: £71.4 million).

The Group spent £39.3 million and £30.9 million on construction and refurbishment of stores, systems improvements and other capital expenditures during 1999/00 and 1998/99 respectively. Disposal proceeds were £3.0 million (1998/99: £5.3 million).

Equity dividend payments amounted to £20.9 million (1998/99: £nil).

The Board of Directors approved this statement of preliminary results on 28 March 2000.

This release includes certain forward-looking information that is based upon management’s belief as well as on assumptions made by and data currently available to management. This information, which has been, or in the future may be, included in reliance on the “safe harbour” provisions in the Private Securities Litigation Reform Act of 1995, is subject to a number of risks and uncertainties, including but not limited to the factors identified in the Company’s 20-F and other documents filed with the Securities and Exchange Commission. Actual results may differ materially from those anticipated in such forward-looking statements even if experience or future changes make it clear that any projected results expressed or implied therein may not be realised. The Company undertakes no obligation to update or revise any forward-looking statements to reflect subsequent events or circumstances.