WEBVTT - Signet CEO Light: We Are Investigating Every Complaint (Audio)

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<v Speaker 1>Charlie. Thank you. From the Bloomberg Newsroom by Mark Crumpton.

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<v Speaker 1>This news update is brought to you by the Jeep

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<v Speaker 1>jeep dealer. Today, the Associated Press reports Egypt says it

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<v Speaker 1>spotted the wreckage of the egypt airplane that crashed into

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<v Speaker 1>the Mediterranean last month, killing all sixty six people on board.

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<v Speaker 1>The country's investigating Committee said in a statement late today

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<v Speaker 1>that a vessel contracted by the Egyptian government to join

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<v Speaker 1>the search efforts for the data recorders and the wreckage

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<v Speaker 1>of Flight A three Quote had identified several main locations

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<v Speaker 1>of the wreckage. Accordingly, the first images of the wreckage

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<v Speaker 1>were provided to the investigation committee end quote. Campaigning in

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<v Speaker 1>Atlanta today, presidential candidate Donald Trump said he's running as

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<v Speaker 1>a Republican but doesn't really care if he gets an

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<v Speaker 1>endorsement from top GOP leaders. You know, the republic and honestly, folks,

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<v Speaker 1>our leaders, our leaders have to get tougher. This is

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<v Speaker 1>too tough to do it alone. But you know what,

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<v Speaker 1>I think I'm gonna be forced to. I think I'm

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<v Speaker 1>going to be forced to. Meanwhile, Hillary Clinton told the

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<v Speaker 1>Borders in Hampton, Virginia, Donald Trump has no idea how

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<v Speaker 1>to stop terrorism. He has been fixated on the phrase

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<v Speaker 1>and I quote radical Islam as if those are magic

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<v Speaker 1>words that, once uttered, we'll stop terrorists from coming after us.

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<v Speaker 1>Mrs Clinton said, quote. Not one of Donald Trump's reckless

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<v Speaker 1>ideas would have saved a single life in Orlando. Global

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<v Speaker 1>News twenty four hours a day, powered by our journalists

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<v Speaker 1>in more than one hundred fifty news bureaus around the world.

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<v Speaker 1>From the Bloomberg News Room by Mark Crumpton, Charlie and

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<v Speaker 1>another after the Bell Deal to tell you about Envision

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<v Speaker 1>buying am Serge, with the deal enterprise value about fifteen

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<v Speaker 1>billion dollars. I'm Charlie Poddett. That's a Bloomberg business flash.

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<v Speaker 1>Charlie Pillett, thank you so very much. Mark in focus now,

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<v Speaker 1>CEO of Signat Jewelers, parent company to the Cay Jewelers

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<v Speaker 1>and Sales brands, among others, has been under fire recently

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<v Speaker 1>for allegations of the company's substituted premium diamonds with cheaper,

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<v Speaker 1>man made substitutes. He sat down with me earlier today

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<v Speaker 1>to discuss how he's addressing investor concerns and what this

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<v Speaker 1>investigation means to the company. First of all, it means

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<v Speaker 1>everything to us, because we are in the business of trust.

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<v Speaker 1>I've been Signal Jewelers is business for a hundred years,

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<v Speaker 1>and I personally have been working for Signal for over

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<v Speaker 1>thirty years. Is the only place I've worked. And over

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<v Speaker 1>the years, year after year after year, we consistently try

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<v Speaker 1>to understand our customers. We serve our customers, and for years,

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<v Speaker 1>and I'm talking for over thirty years, the most important

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<v Speaker 1>characteristic when our customers looking for a diamond or jewelry,

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<v Speaker 1>it's not assortment, it's not the price, it's trust. So

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<v Speaker 1>everything we do as a jewelry people, we always are

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<v Speaker 1>trying to make certain that we have the trust of

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<v Speaker 1>our customers critical. So once we heard about these these

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<v Speaker 1>alleged um diamonds being changed or missing, we got about

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<v Speaker 1>it immediately. Of course, the first thing we did we

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<v Speaker 1>got in touch with the customers and we tried to

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<v Speaker 1>understand the situation, and we wanted to make it right

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<v Speaker 1>for them first and foremost parallel to that, we immediately

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<v Speaker 1>got involved to understand the process, to make sure that

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<v Speaker 1>the process that we have in place is making sure

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<v Speaker 1>that there were no problems. So as a whole we

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<v Speaker 1>react to everyone as as quickly as we possibly can.

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<v Speaker 1>One thing you need to understand is that as signat

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<v Speaker 1>Jeweler's UM we did last year alone over four million.

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<v Speaker 1>It's called the products that went through our repair and

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<v Speaker 1>service of over four million. And when we looked and

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<v Speaker 1>looked and studied our customer complaints that relates to our

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<v Speaker 1>repeer and service centers, less than two tenths of a

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<v Speaker 1>percent of our customers complained about something to do with

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<v Speaker 1>a repair, missing or or quality issues. I'm talking all

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<v Speaker 1>in less than two tenths percent. And by the way,

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<v Speaker 1>two tenths of percent is too much for us and

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<v Speaker 1>for me, so that we are looking at all our

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<v Speaker 1>process and making sure we get it right for our customers.

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<v Speaker 1>Are you concerned that you have You've done interviews like this,

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<v Speaker 1>You've said you've looked into it, and only a tiny

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<v Speaker 1>fractional percentage first of all our complaints from your customers,

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<v Speaker 1>and even then you're you're not Are you saying that

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<v Speaker 1>you have found no one. There's no one who can

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<v Speaker 1>prove that you have found whose diamond was swapped. As

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<v Speaker 1>of yet, we are investigating any customer in every customer.

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<v Speaker 1>As of yet, we haven't verified it, but we're taking

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<v Speaker 1>every every individual customers seriously and if we find something,

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<v Speaker 1>once we get the diamond and we'll have it checked

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<v Speaker 1>and we make sure if it's not, then we will

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<v Speaker 1>get involved and find a figure out. What where is

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<v Speaker 1>the problem. Are you concerned that your share price has

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<v Speaker 1>fallen so sharply? You recently purchased about what two dollars

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<v Speaker 1>worth of your stock a sign. I'm sure you're trying

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<v Speaker 1>to show the public you believe in the company, but

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<v Speaker 1>investors seem to doubt what you have said and potentially done.

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<v Speaker 1>You have to look at our company over years. We

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<v Speaker 1>are we are a company over the last three years

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<v Speaker 1>have had eight to miss uncompounded annual growth rate. If

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<v Speaker 1>you look back another five years or ten years, we

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<v Speaker 1>have been outpacing the growth of the jeweler industry. We've

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<v Speaker 1>been out for it's in the growth of the of

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<v Speaker 1>the retailer sheet and from a profitable perspective, are we concerned?

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<v Speaker 1>Of course, that's why I'm here today trying to set

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<v Speaker 1>the record straight that we had signa Jewelers are making

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<v Speaker 1>sure that we're doing the right things for our customers.

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<v Speaker 1>Keeping their trust is critical. What about concerns about the

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<v Speaker 1>credit facility that you use to help customers buy jewelry

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<v Speaker 1>from you, especially diamond such an important purchase. Issues raised

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<v Speaker 1>by people like Jim Grant, the Grand Interistrate Observer that

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<v Speaker 1>some of these credits may not be as solid as

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<v Speaker 1>they once were, that maybe the way you account for

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<v Speaker 1>them uh makes those credits look better than they really are,

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<v Speaker 1>and that's something that could also be a concern to investors.

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<v Speaker 1>We have been lending money. We've had an internal credit

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<v Speaker 1>business for well over thirty years and the specifically the

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<v Speaker 1>internal credit is servicing our Case stores and our Jared stores.

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<v Speaker 1>Our sales team have we used a d S for

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<v Speaker 1>for our business there. But we've been doing this for

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<v Speaker 1>over thirty years. We've been through three recessions during that

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<v Speaker 1>time frames, so we've we've been using the same methodology,

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<v Speaker 1>the same agent methodology for over thirty years. And by

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<v Speaker 1>the way, um when we start over thirty years ago,

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<v Speaker 1>that methodology was very commonly used in retail and we

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<v Speaker 1>have been using it for over thirty years, and we

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<v Speaker 1>feel very confident going through the recessions that we have

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<v Speaker 1>a good handle on our credit business, very good handle.

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<v Speaker 1>We have the experience there. I wanted the switch gears

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<v Speaker 1>and step back and look at signat Jewelers. What is

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<v Speaker 1>your business tell you about the health of the US economy?

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<v Speaker 1>Is that good and getting better? Are you concerned they

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<v Speaker 1>might be slowing down a bit? Again, if you just

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<v Speaker 1>look at the at our numbers we reported our fourth quarter,

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<v Speaker 1>we reported that we're up on a comp store basis

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<v Speaker 1>four point five which, by the way, is one of

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<v Speaker 1>the tops of retails that reported retailers reported. Then you

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<v Speaker 1>look at our first quarter results, we're up two point

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<v Speaker 1>four percent, again one of the top performing retailers. And

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<v Speaker 1>what we told um the market during our second our

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<v Speaker 1>first quarter call is that we're projecting that the second

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<v Speaker 1>quarter that are comes will be up one to two

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<v Speaker 1>and so there's there has been a deceleration. Um that

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<v Speaker 1>being said, we're doing all we can. We've got a

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<v Speaker 1>lot of great new innovative products that we're developing. We've

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<v Speaker 1>got a lot of exciting new um TV ads are

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<v Speaker 1>working on, and a lot of new exciting training programs,

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<v Speaker 1>but there has been a deceleration. You have business in

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<v Speaker 1>the UK. There's a big vote next week Brexit. Well,

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<v Speaker 1>the UK vote to leave the EU European Union. How

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<v Speaker 1>would that affect you? Look, we've we've known about the

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<v Speaker 1>brexit um for over a year. We've planned for it

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<v Speaker 1>one way or the other. One thing we've we know

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<v Speaker 1>is that whether the people vote to stay in Britain

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<v Speaker 1>or not, people still fall in love. People still have birthdays,

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<v Speaker 1>people still getting married, people still buying birthday presents. So

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<v Speaker 1>we are ready to adjust appropriately, but our product category,

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<v Speaker 1>we believe no matter what happens, people are still falling

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<v Speaker 1>in love and giving gifts to people. Mark White, the

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<v Speaker 1>chief executive of Signet Jewelers. They operate K Jewelers as

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<v Speaker 1>well as Zales and Jared Jewels store chains. The shares

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<v Speaker 1>of signat jew there's down eighty eight cents today, closing

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<v Speaker 1>at eighty two dollars and ninety nine center down more

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<v Speaker 1>than thirty year to date. You're listening to taking Stock.

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<v Speaker 1>I'm Pim Fox my co host Kathleen Hayes. This is

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<v Speaker 1>Bloomberg Radio. Taking Stock is brought to you by E. T. F.

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