Shares in Michael Hill International Ltd (ASX: MHJ) are pushing higher after the jewellery retailer released its half-year results.
In midday trade, the Michael Hill share price is up 2.27% to 45 cents. Earlier in the session, the stock reached 46.5 cents, a 12-month high and a 5.68% gain on the day.
The shares are now up almost 35% in 2026.
Here is what the company reported.
Image source: Getty Images
Earnings growth returns
For the 26 weeks ended 28 December 2025, Michael Hill delivered comparable EBIT of $31 million. This reflects an increase of 28.6% on the prior corresponding period.
Group revenue increased 3% to $371 million, supported by positive performances in Australia and Canada and a return to growth in New Zealand. Same-store sales rose 3.8% across the group.
Gross margin was broadly steady at 61.2%, compared to 61.3% a year earlier. Management said higher gold and silver input costs were largely offset by improved product mix and disciplined pricing.
Reported EBIT came in at $38.9 million, compared to $32.4 million in the prior half. The difference between comparable and reported EBIT primarily reflects lease accounting impacts under AASB 16.
Balance sheet strengthens, inventory reduced
Inventory declined by $11.3 million to $201.9 million during the half. Net cash at period end stood at $20.7 million, compared to a net debt position of $9.8 million a year earlier. That represents a $30.5 million improvement.
The company said it refinanced its existing debt facility on improved terms and continued to focus on working capital discipline.
The store network reduced to 285 locations across Australia, Canada, and New Zealand, down from 294 at the end of FY25 H1.
No interim dividend declared
The board has elected not to declare an interim dividend for the half year.
However, management indicated it intends to return to dividends at the full-year result, subject to trading conditions.
Trading update shows continued momentum
Michael Hill also provided an update for the first 8 weeks of the second half of FY26.
Group sales are up 4.5%, with same-store sales increasing 6% year-on-year.
Looking at a regional basis:
- Australia same-store sales up 6.5%
- Canada up 13%
- New Zealand up 7.1%
Management also cited solid trading across Valentine's Day and Lunar New Year periods.
Foolish Takeaway
The latest result shows improving profitability, stronger cash generation, and better inventory management. While revenue growth remains modest, margin resilience and cost discipline appear to be supporting earnings growth.
With shares at a 12-month high, attention now turns to whether trading momentum continues into the second half.
