Here’s why the Michael Hill (ASX:MHJ) share price is soaring 7%

Here’s why the Michael Hill (ASX:MHJ) share price is soaring 7%

The jewellery retailer reported increased sales over the fourth quarter of FY21, despite facing numerous lockdowns

The Michael Hill International Ltd (ASX: MHJ) share price is gaining today after the company released a trading update for the fourth quarter of the 2021 financial year.

Right now, shares in Michael Hill are going for 87 cents apiece – 6.75% higher than their previous closing price.

Within its update, the jewellery retailer reported strong same-store sales growth and record digital sales.

Let’s take a closer look at the news driving the Michael Hill share price higher.

The Michael Hill share price is soaring on the back of news its same-store sales were up over the quarter just been, despite many of its doors being temporarily closed due to lockdowns.

Over the quarter, Michael Hill’s same-store sales were 7.5% higher than the previous comparable period, bringing in $54.6 million.

The jewellery retailer’s full financial year same-store sales now total $474 million – 8.5% higher than in the previous financial year.

Additionally, its all-store sales were up 116.3% over the quarter, and 13.5% higher than the previous financial year’s.

Michael Hill also reported record online sales over the financial year just been. Its online store processed more than $30 million worth of sales over the 12 months ended 30 June 2021.

That’s particularly fortunate as 102 of Michael Hill’s 150 Australian stores faced temporary closures due to COVID-19 lockdowns over the fourth quarter. In total, the company lost 559 trading days.

Its Canadian stores had a harder time yet. Of the 86 Michael Hill stores in Canada, 40 were closed for most of the fourth quarter and the rest faced restrictions. Michael Hill lost 3,323 trading days in the country.

Michael Hill also reported it maintained its strong margin over the quarter just been, and its earnings before interest and tax (EBIT) is in line with or above analysts’ expectations.

The company expects to end the year with a cash position of around $70 million.

Michael Hill’s CEO and managing director Daniel Bracken said:

(Michael Hill has reported) sales growth in all markets, increased margins, and an outstanding performance from our bricks and mortar stores delivering almost 20% same-store sales growth for the quarter. Setting aside the global store network closure in 2020, Michael Hill has now delivered eight consecutive quarters of positive comp sales growth, together with sustained margin expansion.

This performance provides further evidence that our strategic transformation agenda is on track and delivering.

Michael Hill share price snapshot

Including today’s gains, the Michael Hill share price has increased by 25% year to date. It has also gained 165% since this time last year.

The company has a market capitalisation of around $316 million, with approximately 387 million shares outstanding.

Love, hate and Savvy B

Love it or hate it. That’s the general feeling around Sauvignon Blanc.

Its popularity and commercial success drives the sniffing classes to distraction. If the wine world was to have a moment of cancel culture, Sauvignon Blanc would be it.

But the white wine that can be one of the most over-dramatic, loudest, smelliest, out-there varieties – swinging from cat’s pee pungency and tart gooseberry, sweet and sour pineapple to lip-smacking citrus, fresh to rank tinned asparagus, green beans to tropical fruit salad – remains a consumer favourite.

It’s a wine biz phenomenon that has lasted more than 30 years in Australia and while its sales growth charts may be plateauing over time, as other more exotic varieties garner attention – and Riesling and Chardonnay have never been better – it’s still all the rage.

It can be fresh and zesty, without the complications of other worked-over white wines, and it also can be a fine wine with subtle oak and ferment characters. It can be straight and bent (in a so-called “natural” winemaking style with skin contact and funky flavours.) It ticks all the boxes.

At this time of the year, we start to see the new crop of “freshies”, the 2021s, appearing when perhaps we might think we want to be drinking richer and warming reds. But it’s also the time when oysters and other southern oceanic seafoods are at their finest and that fits right into the gastronomic zone for the variety.

Adelaide’s wine-hospo crew last week attended the annual Shaw+Smith Sauvignon Blanc release celebration, a yum-cha lunch at Gouger Street’s Concubine restaurant. The cuisine match is perfect, and it’s a favourite gathering for restaurant, hotel and bar managers who have championed the Adelaide Hills hero’s style leader.

You want to talk phenomenon? This is it. As popular as ever, and as delicious. Its market power in South Australia is undeniable. Consumer loyalty, Shaw+Smith co-founder and MW Michael Hill Smith says, is “exceptional”.

It has been that way virtually from its beginnings, the first vintage produced in 1990. When pundits talk about South Australian heritage items like frog cakes and Coopers beers and Penfolds Grange, Shaw+Smith Sauvignon Blanc must certainly also be knocking on that door. Its presence is equally powerful nationwide and it shines a bright light on the Adelaide Hills as a wine region and tourism mecca.

“It was the right wine at the right time,” Hill Smith says.

“We knew we wanted to be in the Adelaide Hills – we were wedded to that from the start, so Chardonnay was obvious but we were less sure about Sauvignon Blanc.

“But we realised we could make something that was fresh and vibrant, almost with an innate ‘wildness’ as well.”

At the time, New Zealand’s Marlborough region was the centre of all things “savvy” and inevitably there were comparisons, but much about the general Kiwi style didn’t click with Hill Smith and his co-founder cousin, winemaker Martin Shaw.

“We were never big fans of the slightly sweatier, slightly more herbaceous expressions, which is why we didn’t pick early and go after those characters,” Hill Smith says.

“One of the things over our 30-odd years has been this absolutely recognisable house style, an Adelaide Hills style which I define as pink grapefruit rather than herbaceous, with a bit more palate weight than you get with some Sauvignon Blancs, and a wonderful line of acidity and touch of edginess.

“What’s great about that now, whether it’s Adelaide Hills style or Shaw+Smith style, is that people understand the differences, and that’s terrific.”

It’s not the most intellectual wine that you’ll ever drink – but it’s bloody delicious

Speaking of which, it should be noted that there has been a reboot in the past year or so of what is known as fume blanc styles of Sauvignon Blanc. It’s a wine style matured for a short time in barrel to produce a flinty, almost smoky aromatic note with a textured mouthfeel, from winemaking techniques like skin contact, as well as ferment characters derived from spent yeast lees.

Winemakers can be pretty creative in using any or all of those methods, and what happens in the best of them is a drink with greater complexity and definite ageing potential.

This was exactly how vigneron Xavier Bizot envisaged the variety from his Wrattonbully vineyard in the state’s South-East.

“We wanted to make a fine wine out of Sauvignon Blanc and I realised also it could be made for ageing as well,” Bizot recalls.

He crafts two variations. One is fully in fume blanc style, the Terre a Terre Crayeres Vineyard Sauvignon Blanc fermented in older vessels, 600-litre demi-muids, then matured on all its lees for around eight months. It usually is released after a year in the bottle, when its complexities are better expressed.

The other, under the label Down to Earth, is a middle-road approach, with portions in wood and stainless steel, so it shows freshness along with complexity and texture.

The variety sits between Riesling and Chardonnay for Bizot, able to show the sharpness of the former and the texture of the latter.

“The Crayeres is a more interesting wine than simpler styles, more a fine wine,” Bizot says. “People will see that it’s not just about Chardonnay and Riesling for fine wine, and it can be Sauvignon Blanc as well.”

The cooler climates of the Adelaide Hills and areas of the Limestone Coast produce many of the better examples coming out of SA.

Katnook Estate in the Coonawarra has been a leading exponent of the partly oak-fermented and lees-aged style for close to 40 years. Its Sauvignon Blanc is clear proof that the variety, when treated like this, develops a sophisticated complexity over a decade and is, without question, a fine wine.

Now, also, excellent examples are coming out of the Mount Gambier and Mount Benson regions along the southern coastline, fresh and bright with the mix of herbaceous and wild fruit abandon that has brought so much popular attention to the variety.

The pinnacle remains, however, with Shaw+Smith. It has weathered all the criticism of the grape and set a benchmark for those following in its wake. Even with all its popularity, it has maintained its integrity in quality and style.

“It’s that kind of wine – people see it as the iconic Australian Sauvignon Blanc,” Hill Smith says.

“It’s not the most intellectual wine that you’ll ever drink – but it’s bloody delicious.”

WINE REVIEWS

Shaw+Smith Sauvignon Blanc 2021

Adelaide Hills / 12 % / $29.50

Even with this wine’s remarkable consistency over 30 years, it still shows vintage variation when coming from a cooler season such as the 2021, ripening slowly for heightened aromatics sitting somewhere between snow pea and citrus, including leaf, flower and fruit. The flavour senses bring all that together with peppery spice and a touch of sorrel, entertaining the palate with great, pithy grapefruit texture. In founder Martin Shaw’s words: “It’s as good a Sauvignon as we’ve put out in recent years. We’re thrilled.” And so they should be.

Terre a Terre Down to Earth Sauvignon Blanc 2020

Wrattonbully / 12.9% / $32

A midway style from vigneron Xavier Bizot out of his Crayeres vineyard in the Wrattonbully region just north of Coonawarra. A 39% portion was fermented in large French oak vessels known as foudres, the rest in stainless steel, the blended lot aged on its yeast lees for close to a year. Aromatically more subtle in approach with a suggestion of celeriac and delicate asparagus in a herbed cream sauce. The palate acidity sings in harmony and a citrus pithy texture adds length and salivating pleasure. Its sibling Crayeres Vineyard Sauvignon Blanc from the same year is a tad riper, the citrus feels suggesting tangelo with a slate/mineral texture. Barrel ferment and lees influences are promising further complexity over the next eight years.

Michael Hall Adelaide Hills Sauvignon Blanc 2020

Adelaide Hills / 13% / $38

A fine example of pushing the boundaries with the variety while remaining true to its purest values. From Piccadilly Valley and Forreston source blocks, fermented in oak, a tiny portion on skins and matured for nine months in barrel. Sauvignon without the tropical nose punch, a subtle skins influence only, adding spice to its spectrum of apple flavours, and minerally texture more than anything. Good body shape and more serious structure and finish than most in the genre. A year resting in bottle can only help its fine wine credentials – it’ll be on sale in a month or so.

Katnook Estate Sauvignon Blanc 2019

Coonawarra / 13.5% / $25

From its earliest releases in the 1980s, this wine has always shown an elegance and sophistication derived from selected fruit parcels undergoing barrel fermentation, six months sitting on its spent yeast lees, and another year developing in the bottle before release. The aromatics and flavours have settled well into a lime and grapefruit zone with mouth-pleasing texture and coriander-like spice for extra enjoyment. Patience is a virtue here, the wine drinking with delightful freshness and early complexity now, and a track record to develop even further toasty characters over the next six-10 years.

Support local arts journalism InReview is a ground-breaking publication providing local and professional coverage of the arts in South Australia. Your tax-deductible donation will go directly to support this independent, not-for-profit, arts journalism and critique. Donate Here

Cop who shot and killed Fred Cox Jr. was suspended and demoted in past

Featured photo: Michael Shane Hill after he was hired by the Salisbury Police Department in 2012. Hill is the third individual from the right. (Facebook photo)

Nine years before Davidson County Sheriff’s deputy Michael Shane Hill shot and killed Fred Cox Jr. in High Point on Nov. 8, 2020, Hill was suspended from the Kernersville Police Department. Three days later, Hill resigned from that post. That’s according to public records received by Triad City Beat,which detail Hill’s previous stints at other law enforcement agencies before his current posting at the Davidson County Sheriff’s Office. According to the data collected by TCB, Hill has been suspended as a law enforcement officer twice and demoted once. His most recent suspension took place for more than a month, from Nov. 8-Dec. 15, after he shot and killed Cox.

As outlined in TCB’s previous reporting, Hill had been attending a memorial service in High Point when cars driving past the church started shooting towards the building. According to a witness, Hill, who had been on the other side of the church, began shooting at individuals who were running into the church for cover. That’s when he shot Cox Jr. in the back, killing him. According to the Davidson County Sheriff’s Office, Hill was not wearing a body camera during the incident as the department just started their body camera program this summer. Requests for employee timesheets from the day to see if Hill was on-duty when he shot Cox Jr. were also rejected by the sheriff’s office, who claimed they are not public record. However, email records obtained by TCB show that the High Point Police Department was aware of Hill’s attendance at the memorial service on Nov. 8. In one email dated Nov. 5, 2020, sent at 8:12 p.m. Hill updates High Point police Lt. BJ MacFarland Jr. on his plans to attend the memorial service on Nov. 8. “Lt. MacFarland, the funeral arrangements for Jonas have changed according to the family. The service has moved to the Living Water Baptist Church in High Point with the service time being at 2 p.m. Family said there should be about 75 or so to include family and those close to the family in attendance, but supposedly no gang members. Stay safe and thanks again for all your help.” The email was then forwarded by MacFarland to Police Chief Travis Stroud as well as two other HPD employees.

Another email from Nov. 5 from MacFarland to other HPD employees at 3:23 p.m. note that “Davidson County Deputy Shane Hill will be in attendance in Suit and Tie. It is supposed to be a small private family event but because of the gang ties there is potential for uninvited guests.” Lastly, an email by Police Chief Travis Stroud to his employees on Feb. 1, 2021, after the shooting, appears to warn his officers from repeating Hill’s “mistake.”

“We need to learn from this incident,” Stroud writes. “Make sure we do not replicate ‘mistakes’ from LE side. This is far, far from over and we should be in consistent discussions on ‘what if’ scenarios when word comes down on what the DA is going to do. In the meantime, we will not be allowing any of our officer to attend funerals, visitations, wakes, etc…other than in full uniform security mode, in our jurisdiction.”

Attempts to reach Hill were not successful for this story. As of earlier this month, Hill was still employed by the Davidson County Sheriff’s Office.

Is Michael Shane Hill a “wandering officer”?

Previous employment records for Hill, whose voter registration shows that he is a 43-year-old, white male who is registered as a Republican, reveal that Hill fits into the mold of what some academics call a “wandering officer.”

According to an April 2020 study by Duke law professor Ben Grunwald and University of Chicago law professor John Rappaport, a wandering officer is a law enforcement officer who is “fired by one department, sometimes for serious misconduct, who then finds work at another agency.” According to the study, which was published in the Harvard Law Journal, wandering cops are more likely to be fired again in the future and also to have complaints lodged against them compared to other officers. For the purposes of the study, Grunwald and Rappaport looked at data for 98,000 full-time law enforcement officers employed by almost 500 different agencies in the state of Florida over a 30-year period. Their study found that on any given year during their study, an average of just under 1,100 officers who were previously fired — 3 percent of all officers in the state — worked for Florida agencies.

Michael Shane Hill began working as a police officer for the Kernersville Police Department in January 2000, according to public records. For the next 11 years, Hill worked for the department, with incremental raises every year until September 2011, when he was suspended with pay. He then resigned on Sept. 30. While the date of any suspension or demotion is public record, the reason for the disciplinary action is not. If an officer is dismissed, the reason for the dismissal is public. However, in this case, because it appears Hill resigned, the reason for his departure is not public record.

After being suspended and resigning from the Kernersville Police Department on Sept. 30, Hill was hired by the Salisbury Police Department on March 19, 2012 — less than six months later. There, Hill started as a master police officer where he received incremental raises. In February 2016, he was promoted to corporal until Jan. 4, 2019, when he left. The reason for Hill’s departure was not provided by the department. Less than a month later, he began working at the Davidson County Sheriff’s Office on Jan. 28, 2019. A little more than a year later, in February 2020 — less than nine months before he killed Cox Jr. — Hill was demoted. The details of his demotion are not public record. Hill remains employed by the Davidson Sheriff’s Office as of earlier this month.

According to the Harvard Law study, officers who were once fired from their jobs typically have a hard time finding work again. However, that pattern does not hold for officers who were fired earlier in their careers. Based on the timeline of Hill’s employment records, he would have been about 22 years old when he first started working at the Kernersville Police Department, meaning his suspension in 2011, when he was about 32, could be considered early on his in career. The study also notes that law enforcement agencies “do not always conduct thorough background investigations before hiring.” And even when they do, “past employers are not always forthcoming and sometimes conceal the real reasons for an officer’s separation.”

When asked if the department knew about Hill’s prior suspension at the Kernersville Police Department, a public information officer with the Davidson Sheriff’s Office noted that “pre-employment records are not public record.”

The study also noted that those who were fired once were twice as likely to be fired again as compared to those who had never been fired before. However, in the case of Hill, his termination was listed as “resigned” rather than a dismissal. The study notes that “anecdotal evidence suggests that officers who commit misconduct are often allowed to resign, with a guaranteed positive work reference, in exchange for forgoing legal action.” This, the study hypothesizes, makes it more like for the officers to secure a job in the future because “hiring agencies might view these officers as rehabilitated.”

To be employed in North Carolina, an officer must be certified by the NC Department of Justice. Occasionally, when an officer engages in misconduct, their licenses can be revoked. An employee working in the Office of Administrative Hearings with the NC DOJ told TCB that Hill was not in their records for having had a hearing in the past.

While complaints against officers are not public record in North Carolina, the Harvard Law study shows that officers who had been previously fired from a position were almost twice as likely to receive complaints against them. These include complaints about violence, sexual misconduct or integrity.

On June 1, a Grand Jury failed to indict Hill on two bills of indictment for voluntary manslaughter and felony assault with a deadly weapon. Since then, Cox Jr.’s mother, Tenicka Shannon, has begun working with the attorneys who assisted in the George Floyd case, Ben Crump and Antonio Romanucci. In a statement from June, Jennifer McGuffin, an employee who works with Romanucci and Crump said that “civil litigation is being carefully prepared and will be filed upon completion of a thorough review of the facts to ensure accountability for the death of Fred Cox.”

For previous reporting on the Fred Cox Jr. case go here.