Akron Investor DayTuesday, June 15, 2010

TERRY BURMANTERRY BURMANSignet CEOSignet CEO

3

Safe Harbor StatementSafe Harbor Statement(Private Securities Litigation Reform Act of 1995)(Private Securities Litigation Reform Act of 1995)

This presentation include statements which are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements, based upon management’s beliefs as well as on assumptions made by and data currently available to management, appear in a number of places throughout this presentation and include statements regarding, among other things, our results of operation, financial condition, liquidity, prospects, growth, strategies and the industry in which the Group operates. Our use of the words “expects,”“intends,” “anticipates,” “estimates,” “predicts,” “believes,” “should,” “potential,” “may,” “forecast,” “objective,” “plan” or “target,” and other similar expressions are intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to a number of risks and uncertainties, including but not limited to general economic conditions, the merchandising, pricing and inventory policies followed by the Group, the reputation of the Group, the level of competition in the jewelry sector, the price and availability of diamonds, gold and other precious metals, seasonality of the Group’s business and financial market risk.

For a discussion of these and other risks and uncertainties which could cause actual results to differ materially, see the “Risk and other factors” section of the Company’s Fiscal 2010 Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission on March 30, 2010 and other filings made by the Company with the Commission, which can be found on the Company’s website at www.signetjewelers.com. 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 realized. The Company undertakes no obligation to update or revise any forward-looking statements to reflect subsequent events or circumstances.

Certain financial information used during this presentation are considered to be 'non-GAAP financial measures'. For a reconciliation of these to the most directly comparable GAAP financial measures, please refer to the Company’s release, dated March 25, 2010, available on the “Latest News” section of the Company’s website at www.signetjewelers.com.

4

Program Program WelcomeIntroduce Ron RistauUS Division – Mark Light and US executivesLunchHome Office Tour / Additional presentationsTravel to ClevelandStore ToursTravel to Cleveland Airport or return to AkronDinner with management

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Operating PrinciplesOperating PrinciplesContinuous improvementExcellence in executionNarrow and deepTest before investDisciplined investmentStrong balance sheet & financial flexibilityMonitor performance and manage risk

6

Continued Progress in Continued Progress in Executing Two Year StrategyExecuting Two Year Strategy

Leverage competitive advantages to gain profitable market share Reduce business risk

aim to improve store productivitymaintain financial strength & flexibility

Focus on profit & cash flow maximizationWell placed for recovery in consumer spending

7

Long Term StrategyLong Term StrategyTake advantage of economic recoveryGain market share in existing store baseInvest in US space growth that satisfies IRR hurdleAcquisitions in N. America of business that meet demanding operating criteria and satisfy required investment returnsConsider other investment opportunitiesReturn cash to shareholder

8

Signet UKSignet UK

“Market Leader, High Returns, Strong Cash Flow”

9

UK BrandsUK Brands

Sales: £247.8mStores: 34712% of salesNo.1 jeweler in UK

Sales: £209.8mStores: 20510% of salesNo.2 jeweler in UK

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H.SamuelH.Samuel

22%22%naDiamond jewelry

£52£48£37Average selling priceMerchandise mix

28%27%naGold & silver jewelry

£712£718£723Average sales per store (‘000)

25%26%naWatches

347352398Stores at y.e.£248£250£282Sales (million)

Fiscal 2010

Fiscal 2009

Fiscal 2005

Leading middle market brand in UKOnly specialty jeweler using national TV advertising

11

Ernest JonesErnest Jones

£228*£202£141Average selling priceMerchandise mix

14%13%naGold & silver jewelry39%40%naDiamond jewelry

£1,027£1,047£1,150Average sales per store (‘000)

35%35%naWatches

205206204Stores at y.e.£210£208£221Sales (million)

Fiscal2010

Fiscal 2009

Fiscal 2005

Leading upper middle market brand in UK

* Excluding charm bracelet category

12

0

1000

2000

3000

4000

5000

600019

8119

8319

8519

8719

8919

9119

9319

9519

9719

9920

0120

0320

0520

0720

09

£mLong Term Industry GrowthLong Term Industry Growth

Source: UK Office National Statistics

c.a.g.r. 5.0%

UK Jewelry and Watch Market

13

Industry Leading PerformanceIndustry Leading Performance

8.2%

22.9%

EBIT/Total Assets(a)

5 year average

5.7%(2.5)%Typical UK Specialty Jewelers(c)

11.4%(1.4)%Signet UK(b)

Operating Margin 5 year average

Sales Growth 5 year c.a.g.r.2004 to 2008

(a) Total assets excludes goodwill(b) To y.e. January 2009(c) To y.e. 31 March 2009 based on Companies House filings for 5 largest speciality jewelers excluding Signet

Total number of specialty jewelry stores in UK ~7,300

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Sustainable Competitive Sustainable Competitive AdvantagesAdvantages

Leading staff training & development recognized by National Association of GoldsmithsScale, direct sourcing supply chain capability & merchandising expertise14 million name database for customer relationship marketingShopping trend to regional malls favorableUtilization of US best practice & access to exclusive merchandise

15

UK StrategyUK StrategyMaintain sector leading operating standardsLeverage strong market position

enhance selling skills and product knowledgeof staffmore targeted and differentiated merchandisingdrive footfall through customer relationship marketingoptimize real estate utilize access to US best practice

Make existing space work harder

16

Opportunity to Regain Historic Opportunity to Regain Historic ReturnsReturns(1)(1)

ROCE (%)

39.643.8 41.2

46.0 44.2

26.0

34.0 33.7

24.820.1

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

Operating Margin (%)

7.78.8

11.411.010.5

15.515.313.612.911.8

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

(1) Fiscal 2001 prepared under UK GAAP, fiscal 2002 & 2003 prepared under IFRS(2) ROCE excluding goodwill(3) Before goodwill impairment of $108.9m

Fiscal 2001-2005 average:Operating Margin: 13.8%

Fiscal 2001-2005 average: 43.0%

(2)

(3)(3)

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Challenging Trading EnvironmentChallenging Trading EnvironmentMore tentative economic recovery in UK than in USUncertainty due to general election & change of governmentIncrease in selling prices due to:

sterling weaknesshigher cost of gold VAT increase

Q1 resultssame store sales down 0.2%gross merchandise margin down 90 bptsoperating loss $1.4 m (fiscal 2010 Q1: loss $1.3m)

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Attractive BusinessAttractive BusinessClear market leader in scale and operational executionROCE 20.1% in fiscal 2010Strong free cash flowLimited forex exposure

1 cent move impacts operating income by ~$0.2m/0.07%

High operational leverage with potential to return to historic operating margins

Ron RistauRon RistauChief Financial Officer DesignateChief Financial Officer Designate

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First ThoughtsFirst Thoughts

Initial impressionKey financial strengthsStarting priorities

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Initial Operating ImpressionsInitial Operating ImpressionsDepth & experience of management in US & UK Focus on the customer throughout the organizationExcellent store service & commitment to consistent training & development of store staffA unique accounts receivables process with strong financial disciplines focused on jewelry sales & effective collectionInventory & real estate investment driven by ROI, market analysis and customer demandExcellent financial controls & strong operating processes

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Effective Financial Management in Effective Financial Management in Difficult EnvironmentDifficult Environment

Proven ability to manage costs & working capital while supporting growth initiatives & key corporate prioritiesDisciplined investment appraisal procedures & appropriate hurdle ratesStrong balance sheet & financial flexibilitySignificant potential to leverage the operating structure as store productivity improves

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Key Starting ObjectivesKey Starting ObjectivesMaintain the consistency of financial services as we transition leadershipEffectively relocate selected Group financial support functions to AkronSupport the management & Board as we study & establish our future financial structureMaintain & manage the successful navigation of the current retail environmentContinuously evaluate growth & profit enhancing opportunities

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MARK LIGHTMARK LIGHTPresident & CEO, Sterling Jewelers

“Further growth from a proven strategy”

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US Management StructureUS Management StructureMark Light

President and Chief Executive

Officer

Bob TrabuccoEVP & Chief

Financial Officer

Bill MontaltoEVP & Chief

Operating Officer

Ed HrabakSVP & GeneralMerchandise

Manager

Tryna KochanekSVP Field

Operations

Steve BeckerSVP HumanResources

George MurraySVP Marketing

Mario WeissSVP CreditOperations

Bob KnappSVP Supply

Chain &Distribution

Bruce KennySVP Store

Planning/Real Estate

Steve VeneziaSVP IT

Simon CashmanSVP Finance

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Morning Program Morning Program Mark Light - US Overview, Competitive Strengths & Store Operations Ed Hrabak - MerchandisingGeorge Murray - MarketingBob Trabucco - CreditBill Montalto – Information Support SystemsHome Office Tour or Themed Presentations

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Afternoon Program Afternoon Program Travel to ClevelandJared

Diamonds, Merchandise & Selling SystemDesign & Repair CenterLe VianSterling Performance Matrix

MallStore Design & MerchandisingAssociate Training SystemProfit ManagementStore Standards

Travel to Cleveland Airport or return to AkronDinner with management

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Our MissionOur Mission

Convenience

Value

RewardsServices

CommunicationsProducts

Continuous improvement

IntegrityAssistance

Return onassets

TeamworkA superior customerexperience

To achieve:To conduct ourselves as a company with:

To earn the trust of our customers by delivering:

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Competitive AdvantagesCompetitive Advantages

• Differentiated merchandise

• Sophisticated systems

• GMROI focused

• Superior supply chain

Merchandising

• Strict criteria, regularly reviewed

• High quality locations & store fit

• Leading store productivity

• National television advertising

• Research based

• Champion / challenger approach

• Closely monitored store standards

• Measurable objectives

• Leading training systems

Real EstateMarketingStore Operations

Control and information systems

Very experienced & stable managementConsistency of strategy & execution

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US Business CharacteristicsUS Business CharacteristicsCustomer profile

Kay & Regionals customer’s household income ~$35k-100k, ASP ~$312Jared customer’s household income ~$50k-150k, ASP ~$710(1)

Driven by bridal and gift giving categories45% to 50% bridal related

~75% of merchandise sales diamond jewelry43% of space off-mall

(1) Excluding charm bracelet category

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Factors Supporting Long Term Factors Supporting Long Term Growth in Jewelry SalesGrowth in Jewelry Sales

Recession not changed our customers’ desirefor jewelry

bridalgift givingself reward

Jewelry is the most meaningful gift as an expression of love & commitmentAs real incomes grow, proportion spent on jewelry risesPrice inelastic, wide range of price points to satisfy customer’s budget

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Long Term Industry GrowthLong Term Industry GrowthUS Jewelry and Watch Market(a)

010203040506070

1981

1983

1985

1987

1989

1991

1993

1995

1997

1999

2001

2003

2005

2007

2009

$bn

Sources: (a) US Department of Commerce & Census Bureau(b) IDEX

~40% of world diamond sales(b)

c.a.g.r. long term 4.8%; 2 year (4.5)%

• Specialty sales • Non-specialty sales • Internet sales

33

NonNon--Specialty SalesSpecialty Sales(1)(1)

Mostly “low end” fashion jewelry, no bridal, no service$0.4bnJTV

Mostly “low end”, minimal bridal, little service element$0.5bnTarget

Mostly high end designer jewelry & watches, minimal bridal$0.4bnNeiman Marcus

Mostly “low end” fashion jewelry, no bridal, no service$0.3bnHSNAll non-precious fashion jewelry, no bridal$0.9bnClaire’s

21% of jewelry sales$17.5bnOther

Mostly “low end” fashion jewelry, no bridal, no service$1.2bnQVCOthers major retailers share of jewelry sales estimated ~5%

Mostly high end designer jewelry & watches, minimal bridal$0.2bnSaks Fifth Avenue

Range of fashion jewelry & watches, minimal bridal$0.7bnJC PenneyRange of fashion jewelry & watches, minimal bridal$0.8bnSearsRange of fashion jewelry & watches, minimal bridal$1.4bnMacy’s

Department stores share of jewelry sales estimated ~10%Mostly “low end”, minimal bridal, little service element$0.3bnKohl’s

Mostly diamond jewelry, minimal bridal, no service $0.5bnCostcoMostly “low end”, minimal bridal, little service element$2.8bnWal-mart

Discounters / Warehouses share of jewelry sales estimated ~11%

(1) Source: National Jeweler

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Impact of the InternetImpact of the InternetJewelry is very personal and diamonds are not homogeneous, so not suited to remote sellingInternet jewelry sales therefore mostly high value certified stones or low value fashion jewelryEstimated to be 4.6(1)% of total jewelry sales

only significant specialty internet jewelry retailer is Blue Nile with US sales of $268.9 millionAmazon jewelry sales estimated at $225 million(2)

many specialty jewelers have websitesMajor impact has been on pricing transparency in certified stones, not volume

(1) Source: Census Bureau for 2009(2) Source: National Jeweler

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2009 Specialty Jewelry Market2009 Specialty Jewelry MarketTotal specialty jewelry sales of $28.3bn(1)

Sterling share 9.1%average selling price ~$350(2)

Mid market estimated to be ~$23bnSterling share ~10.9%

Bridal category estimated to be ~$13bnSterling share ~9-10%engagement, bridal & anniversary average price of engagement ring estimated to be $3,200(2) in 2009

(1) Source: US Census Bureau(2) Source: IDEX

36

Consistent Gains in Consistent Gains in US Specialty Market ShareUS Specialty Market Share

Liquidated 1.1%0.7%nilnilFinlay(1,2)

-Liquidatedna1.5%1.2%Friedman(1)

-Liquidated0.9%1.1%1.1%Whitehall(1)

(1) Share of US specialty jewelry market based on SEC filing.(2) Finlay acquired Bailey, Banks & Biddle in November 2007 from Zales,Congress Jewelers in November 2006 & Carlyle Jewelers in May 2005.(3) 2009 based on earnings release February 24, 2010.

1.0%0.9%1.0%0.6%0.1%Blue Nile(1)

4.7%4.9%4.8%3.8%3.1%Tiffany(1)

4.9%5.5%6.3%7.8%5.8%Zale(1,2,3)

9.1%8.6%8.7%7.4%5.2%Sterling 20092008200720041999

37

Rationalization of Top US BrandsRationalization of Top US Brands

202

235376178

693923

2009

287261314Gordons(1,2)

n/an/a

n/an/a375375723

1,5082009

436386475410Fred Meyer(3,4)

17In Chapter 11150 ~210Shane(6)

382Liquidated 2008334243Whitehall(1,5)

646Liquidated 2008425n/aFriedman’s(3)

Liquidated 2009

235

154

784926

2008No. of storesSales $mMid market brands

nil

500

415

1,0711,1742004

135726Jared(1)

265400Helzberg(3)

310

1,4392008

Nil

757832

2004Kay(1)

Finlay Speciality(1,2,7)

Zales(1,2)

Calendar

(1) Source: Accounts. (2) July year end.(3) Source: National Jeweler estimate.

(4) Includes Littman’s and departments in supermarkets.(5) Includes Lundstrom.(6) Chapter 11 filing.(7) Bailey, Banks & Biddle; Carlyle; Congress.

1,110 {1,363

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Other Rationalization Since Start 2008Other Rationalization Since Start 2008Liquidated

Christian Bernard, 15 storesFortunoff, 20 storesAlpha Omega, 4 stores

Chapter 11 restructuringRobbins Brothers, closed 6 stores, -38% Ultra, closed 45 locations, -25%

Store closuresReeds Jewelers closed ~28 stores, -30%Don Roberto closed ~23 stores, -23%Hannoush ~15 stores, -19%

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Consolidation in 2010Consolidation in 2010

Signet forecast to close 40 - 50 storesZales closed ~20 year to dateMovado to close 26 storesSamuels to close ~30 storesMichael Hill to close 8 stores

Estimated ~12% of store base exited specialty sector in 2008 & 2009 combined

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Industry Leading PerformanceIndustry Leading Performance

0.8%9.8%8.7%Signet US(5)

(13.2)%1.3%2.7%Typical US Chain Jeweler(4)

(15.1)%(9.2)%(6.1)%Zale Corp(3)

(6.3)%7.5%6.8%Signet US(2)

(19.6)%

EBIT/Total Assets(1)

(12.6)%(13.2)%Zale Corp(3)

Calendar 2009 Performance

Total Sales

Operating Margin Calendar 2008 Performance

(1) Total assets excludes goodwill(2) To y.e. January 31, 2009 excluding goodwill impairment(3) To y.e. January 31, 2009 & 2010 based on SEC Filings and restated quarterly results ex. goodwill impairment(4) To y.e. December 31, 2008 based on JA Cost of Doing Business(5) Excluding benefit from change in vacation entitlement policy

41

““Our People Make the DifferenceOur People Make the Difference””

Customer service remains central to selling jewelry

every piece is under lock & keycustomers need to be educated about the product competitive advantagesup-selling and add-ons

42

““Our People Make the DifferenceOur People Make the Difference””

Team Membersclear and measurable expectationsconsistent training and feedback on performancemonitoring mechanisms provided daily for every team memberexcellent incentives“Promotion from Within” culturevery good career path opportunitiesabove average retention for retail

43

Clear Measurable ExpectationsClear Measurable ExpectationsDaily store standards

store staff “controllables”clear performance expectationsindividual standards integrated into divisional goals

Monitoringovernight reports provided to store staff and District Manager

Customer service feedback

44

Strong Team IncentivesStrong Team IncentivesHistorically 20% - 25% of field payroll performance basedSales associate commission

based on own and store performanceencourages team work

Manager profit bonusprofit based bonus monthly store operating statementtrained to be profit business managers

District Manager bonusKPI based bonus

45

Best Support Systems Best Support Systems For Our Store TeamsFor Our Store Teams

360 degree communication systemOrganizes tasksTracks individual key performance indicatorsProvides targeted training that is tailored to the needs of the individualImproves executional effectivenessGreater process monitoring and compliance

46

Great Merchandising Great Merchandising For Our Store TeamsFor Our Store Teams

Most efficient and flexible supply chainIndividual store by store merchandisingSuperior merchandising systems

enables testingearly identification of trends

Ability to develop differentiated ranges

47

Outstanding Marketing Support Outstanding Marketing Support For Our Store TeamsFor Our Store Teams

Leading share of voice and great executionAbility to use national television advertising

built store brand awarenessmarket differentiated product

Sophisticated customer relationship marketingSector leading “brick & click” capability

48

Superior Credit Programs Superior Credit Programs For Our Store Teams For Our Store Teams

Tailored to our customers needsLeading authorization and collections system built on jewelry sector dataOperated to our corporate prioritiesExecuted to our customer service standards

49

SterlingSterling’’s Medium Term s Medium Term PotentialPotential

Return to historic operating margins and ROCE levels

rebuild store productivityreduce net bad debt

50

Opportunity to Regain Historic Opportunity to Regain Historic ReturnsReturns(1)

ROCE (%) 23.0

19.921.7 21.3 22.2 22.1 21.2

15.1

8.111.1

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

Operating Margin/Bad Debt (%) 12.4 11.1 12.1 12.4 12.8

9.26.8

9.812.012.8

-3.4 -3.2 -2.8 -2.8 -2.8 -3.0 -2.8 -3.4 -4.9 -5.6

(1) Fiscal 2001 prepared under UK GAAP, fiscal 2002 & 2003 prepared under IFRS (2) ROCE excluding goodwill(3) Fiscal 2009 before goodwill impairment of $408.0m

Fiscal 2001-2007 average:Operating Margin: 12.2%

Net Bad Debt to Sales: -3.0%

Fiscal 2001-2007 average: 21.5%20

10

2009

2008

2007

2001

2002

2003

2004

2005

2006

(2)

(3)

(3)

51

Store Productivity/ASP OpportunityStore Productivity/ASP Opportunity

$346

$747

$331

Peak

$1.52m

$5.68m

$1.82m

Peak Fiscal 2010

Fiscal 2010

$329$1.16mRegional Brands

$713(2)$4.05mJared

$307$1.58mKay

ASPAverage Sales per Store(1)

(1) Based only on stores operated for the full fiscal year.(2) Excludes the charm bracelet category.

52

Q1 PerformanceQ1 PerformanceChallenging marketplace

total revenue 6.8% comps. 7.2%

Gross merchandise margin up 90 bptsAccounts receivable performance improved by 120 bptsControllable expenses slightly downOperating margin up 470 bptsOperating profit $91.1m, +61.5%Outlook remains uncertain

typically require low single digit comp. sales to achieve leveragemarginal sales profitability against plan usually ~40% during year

53

US Sales OutlookUS Sales OutlookPotential recovery in specialty jewelry sales

2009 sales down 9.8% from 2007 peak recovery driven by economy, but outlook unclear

Market share opportunitycapacity withdrawalmany remaining competitors operationally weakened and/or financially constrained

Potential for space growthbegun to see some opportunitieslimited high quality real estate availableapply demanding Return On Investment and operating criteria to all acquisition opportunities

Demanding investment requirements

54

US Changes in Square FootageUS Changes in Square Footage

(2)%1,319180224127788Jan 2011 (forecast)

1,750+300+100+~500~850Long term potential

167135(2)Openings4%1,401171304131795Jan 2009

(50)-(36)(4)(10)Closures (approx.)

(1)%

10%

Change in

Space

4794

(6)

789

Kay Mall

2178

-

154Jared(1)

-260

(45)(2)

351Regionals

82Openings (forecast)1,361129Jan 2010

(56)(5)Closures

1,399105Jan 2008Total

Kay Off Mall

(1) A Jared store is equivalent to just over four mall stores in size(2) Includes 14 rebranded stores in 2008 and 2 in 2009

55

Growth Potential Built on Increasing Growth Potential Built on Increasing Leverage of Competitive AdvantagesLeverage of Competitive Advantages

Ability to recruit, train & keep best sales associates and field managementSupported by superior execution of other retail disciplinesStrong balance sheet means able to focus continually improving execution Consistency of strategy and leadershipIncreasing market leadership further leverages scale advantages

56

Ed HrabakEd HrabakSVP Merchandising,SVP Merchandising,

Sterling Sterling JewelersJewelers

“Supply chain & merchandising initiatives”

57

MissionMissionGeneral

right product, right price, right place, right timedevelopment of differentiated rangesoffer value items for price conscious consumer gross margin managementpursue supply chain opportunities

Critical to Jewelryimportance of commodities

• quality control as each diamond is uniqueoptimize inventory investment as largest element of capital

58

Competitive Advantages in Competitive Advantages in Supply Chain & MerchandisingSupply Chain & Merchandising

Sector leading systems and proceduresDirect sourcing of loose polished diamondsDetailed understanding of manufacturer’s costs Attractive partner with vendors due to our volume and financial strengthAbility to identify trends early

59

Utilize Utilize ““PullPull”” MethodologyMethodologyCategory has slow changes in fashion & limited seasonality

test and run every product/programability to respond to trends within season

GMROI focusedMerchandising reflects individual stores selling patterns, local demographic & regional variationsMaximizes sales, minimizes mistakes

60

Advantages of Differentiated Advantages of Differentiated MerchandiseMerchandise

Drives footfall and differentiates storesLower risk of competitive discountingOffered manufacturers’ best ideas ahead of competitionSpeed to marketClearer, more cost effective marketing messageSymbiotic marketing leverageBetter able to execute future development of ranges

61

Ideal Partner for Branding Ideal Partner for Branding Commitment to testing and development of merchandising programsTraining of sales associatesAbility to provide marketing supportCritical massEstablished supplier relationshipsProven track record in brandingConsistency of strategy & executionFinancial strength

62

Differentiated Merchandise Differentiated Merchandise Increasing Opportunity to Drive Increasing Opportunity to Drive

ShareShareDifferentiated merchandise combines our competitive advantages reinforcing their impact

merchandisingmarketingstore operationsbalance sheet

Opportunities to gain market share fromspecialty sector competitorsnon-specialty jewelry retailersother gift giving and self reward categories

63

Highly Recognized Branded Highly Recognized Branded DiamondDiamond

2000: first tested2002: introduced to all storesContinued development of range

cutsproductsLeo Artisan

2008: improved specification2009: expanded bridal range“One of the most recognized diamond cuts in the US”

64

Peerless DiamondsPeerless DiamondsExclusive to Jared Launched Fall 2005The Ideal, Ideal cut diamond

ideal cuttriple very high return of light

65

Rapid Innovative MerchandisingRapid Innovative MerchandisingOpportunity identified early 2008Tested Mothers Day 2008Rolled out for Holiday 2008Continued strong performance Valentines and Mothers Day 2009Expanded range and improved availability for Holiday 2009Product and Marketing evolving

66

Major Initiative For Holiday 2009Major Initiative For Holiday 2009

Followed the Jane Seymour launch templateDifferent product ‘story’ and price points to Open HeartsConcept: for the person who wants to declare their love for anotherCompetition from

“Everlon”Expanding rangein 2010

67

Partnering With Branded Partnering With Branded JewelryJewelry ManufacturersManufacturers

“Build a memory”Tested 2008Female self-purchasersJared rolled-out fall 2009Jared TV ad for Holiday 2009Opportunity to convert to Jared customer

68

Le Le VianVianStocked in all Jared stores

Le Vian boutiques in selected JaredsExclusive to Signet among specialty mall jewelersMany exclusive designsHigh level of female self-purchaseFirst time advertised on national televisionMarket to Le Vian gala events using CRMCustomer assisted selling system developed with Le Vian

69

Test Before We InvestTest Before We Invest

Make sure we are backing winnersidentify best designs within rangeenables more accurate forecastingability to identify and react to changes in selling patterns

Currently testing a range of new fashion programssilver statement jewelrycolor range in partnership with Swarovskicharm bracelet range for all mall stores

70

Developing Differentiated Developing Differentiated Ranges for Bridal CategoryRanges for Bridal Category

Accounts for 45% - 50% of US salesOpportunity to leverage polished diamond sourcing advantagesVery few differentiated bridal programs in middle marketPotential to advertise outside gift giving seasons

71

Value ItemsValue Items

Ability to take advantage of market anomalies

expertise in marketplacebalance sheet strength

Selected items only, to minimize adverse impact on gross merchandise marginCaters to more price conscious consumer in challenging environment

72

Gross Margin DynamicsGross Margin DynamicsDiamonds ~55% of COGS in fiscal 2010

polished diamond prices down in fiscal 2010increases in fiscal 2011

Gold ~20% of COGS in fiscal 2010gold costs +~25% p.a. for last 5 years

Able to adjust prices as commodity costs take time to impact gross merchandise marginMix changes

differentiated ranges / value items / solitaire diamonds

73

Gross Margin InitiativesGross Margin InitiativesAble to identify trends early as active in polished diamond marketsSystems and procedures in place to allow considered responseSupply chain improvements

partner with lowest cost suppliers on worldwide basisleverage operational scale, stability and financial strengthenhance supply chain responsiveness

Reduced exposure to competitor discounting

74

Pricing ConsiderationsPricing ConsiderationsInelastic consumer response

infrequent purchase of non-standard productintrinsic underlying value

Consumer usually has a $ budget not product specification constraint

merchandising offers wide range of price pointsbridal & other categories have different dynamics

Signet has lowest cost supply chain

75

Trend in Operating MarginTrend in Operating MarginNet of changes in Gross Merchandise MarginNet of changes in Gross Merchandise Margin

0

2

4

6

8

10

12

14

Fiscal 05 Fiscal 06 Fiscal 07 Fiscal 08 Fiscal 09 Fiscal 10

%

Fiscal 2011, broadly similar to last year’s level

Negative impact to operating marginPositive impact to operating margin

76

Providing Competitive Providing Competitive Advantage to Field StaffAdvantage to Field Staff

Superior quality of merchandiseHigh “in-stock” levels Rapid clearance of slowing linesAppropriately targeted merchandise, including

female self purchasevalue conscious customeryounger malesyounger females

Differentiated merchandise supported by national TV advertising

77

George Murray George Murray SVP, Marketing,SVP, Marketing,Sterling Sterling JewelersJewelers

“Sector leading share of voice”

78

Marketing LeadershipMarketing Leadership“Every kiss begins with Kay”

largest marketing budget in mid-market sectorfocus on national television advertisingromance & appreciation used as consistent theme over time and across media

“He went to Jared”above average advertising/sales supportawareness & reason drives advertisingused national television for 4 years which creates greater leverage

Regional brandsvery well established local identitiesCRM focused marketing

79

Focus on TV AdvertisingFocus on TV AdvertisingVisual product & emotional messageBenefit of national TV advertising

provides greater marketing leveragebrand name recognition in new marketsbetter program placementadditional benefits such as sponsorship opportunities

Limited competitionProven effectiveness

acceleration in Jared sales growth when TV introduced in local marketsKay comp. store sales growth over 6% pa higher than regional brandsgrowth of differentiated product & Kay performance up over last 18 months

80

Kay v Regional Brands Kay v Regional Brands Sales per Store Sales per Store

020406080

100120140

Inde

x

Fiscal2000

Fiscal2002

Fiscal2004

Fiscal2006

Fiscal2008

Fiscal2010

Kay Regional Brands

81

Building Brand EquityBuilding Brand Equity

Kay advertising awareness has built from just under 45% in 2003 to over 75% in 2009

total brand awareness for Kay is 95%

Jared advertising awareness has built from low teens to just over 70%

Total brand awareness for Jared is in the mid 80%s

Customer experience scores continue to increase driven by visit intent

82

High Advertising/Sales RatioHigh Advertising/Sales Ratio

Sterling: Advertising gross of vendor contributionsTiffany: Worldwide spendZale Corp: y.e. July, advertising net of vendor contributions, including CanadaTypical jeweler: JA Cost of Doing Business Total promotional expenditure

0

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8

2002 2003 2004 2005 2006 2007 2008 2009

% re

venu

e

83

Changing Role of De BeersChanging Role of De BeersHistorically a major driver of innovation and marketing within jewelry sectorChange in strategy

away from generic beacon programs e.g. Journey rangefocus on branded merchandise e.g. Everlonrequires retailer marketing contribution

Implications for Signetwhy fund competitor’s marketing?executional difficulties possible exposure to competitor discounting

84

Marketing of DifferentiatedMarketing of DifferentiatedProductProduct

Establish differentiated product by leveraging strong Kay & Jared brand equityFully integrated into TV adsOverall budget means product placement possibleLeo 10th year anniversary

85

Customer Relationship Customer Relationship MarketingMarketing

Proprietary database of 26 million names built up over more than 15 yearsBuild out customer profilesUtilize multiple “touch” points

in-store, on-line, credit, repairs, extended service plans, warranties, gift cards

Contact via phone, mail & emailBehavioral models built on our customer’s response to our events

continually testing alternative strategiesMajor opportunity created by new Pandora customer in Jared

86

Kay.comKay.com

87

Jared.comJared.com

88

Testing New MediaTesting New MediaUse normal Return on Investment evaluation methodsTested banner ads but very limited successSearch advertisingCarrying out research & development using social media

Jane Seymour micro-site, YouTube, Facebook, mobile and e-cards

89

90

Sustainable Competitive Sustainable Competitive AdvantageAdvantage

National television advertising remains by far the most effective form of advertising in the jewelry sectorKay & Jared are the only retail jewelry brands that have the scale to use it economically and efficientlysuccess with differentiated brands

Leading in application of customer relationship marketingBest integrated e-commerce capability in sectorContinually evaluating alternative strategies Scale to significantly out-spend competitors

91

Bob Trabucco Bob Trabucco EVP, Chief Financial Officer,EVP, Chief Financial Officer,

Sterling Sterling JewelersJewelers

“We sell jewelry, not credit”

92

Credit an Important Element of Credit an Important Element of Sales TransactionSales Transaction

Sales enabler not a sales driver over half of business transacted on creditcustomers need/prefer to use private label for jewelry

Used by sales associates to trade customer uphigher ASP of about $1,000

Highly effective target marketing vehicleover 3 million account holdersloyalty factor encourages repeat business

Credit customers lifetime value is 3.5X greater

93

InIn--house Credit Operationhouse Credit OperationA Competitive AdvantageA Competitive Advantage

Optimizes control of the businessWe manage in context of our business priorities, including gross merchandise margin on saleTailored program to our customers’ needs

score cards specific to our customersrapid collection with targeted strategiesSterling customer service standards

Different risk parameters from a bankability to react faster to changes in conditions

94

Third Party Suppliers Have Third Party Suppliers Have Different PrioritiesDifferent Priorities

Bank focus is on maximizing portfolio ROAslower repayment schedule maintains higher balances to drive interest incomecollection is to recoup cash paid to purchase the receivable...not collecting marginlower risk tolerancefluctuating lending standards based on economymerchant fees augment bank’s return

Outsourcing increases, not reduces risk

95

Highly Disciplined Approach Highly Disciplined Approach to Creditto Credit

Statistical science applied to all aspects of the operation from Lending to Recovery

consistent standards over the long-termAll portfolios affected by environment

ability to respond quickly focusing exclusively on our customer attributes

Lending: continually assessing performanceRecovery: targeted strategies

e.g., hardship payment programs, security interestFull Service Customer Care approach

96

Credit Within Specialty Jewelry Credit Within Specialty Jewelry SectorSector

Zalesfinances ~40% of US fine jewelry salescontract requires $6 million paymentFebruary 2010 Citibank advised “intention to tighten certain customer approval criteria and to close certain high risk accounts”Citibank exercised right to terminate

CIT Chapter 11constrained ability of some independent jewelers to grant credit

HSBC and GE Capitalboth reducing exposure to private label credit

97

Sterling Credit CustomerSterling Credit Customer~50% typical bank credit customer

financial flexibilityinterest free option

~50% specialist lendingyoung with limited, if any, credit history

• high level of financial commitments as setting up home

High bridal participationASP well above average

Managing this customer segment is a key differentiator

98

SterlingSterling’’s Credit Operations Credit Operation50% to 55% of salesIntegrated into businessIncluded in IRR calculation for store investmentCentralized credit function since 1994

periodic review by outside expertsLending Risk Management is highly automated and disciplined

automated use of third party information sourcesto verify applicationdecision on ~80% of in-store applicants made within 20 secondsreferrals made for inconsistency in applicationadd-on sales managed through updated scoring

99

SterlingSterling’’s Credit Characteristicss Credit CharacteristicsAverage balance outstanding ~$1,000Average turn ~8 monthsInterest rate charged average ~20% APR

~25-30% of portfolio is interest free• 20% down payment and minimum purchase

requirement

100% provision for bad debt when aged 90 days on a recency basisAverage ~$845m outstanding in fiscal 2010

moved broadly in line with salesfunded from general corporate resources

100

Consistent Lending PhilosophyConsistent Lending PhilosophyLess Volatile PerformanceLess Volatile Performance

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collectionrate %

101

Further Evidence of Improved Further Evidence of Improved Receivables Trend in Q1Receivables Trend in Q1

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of total sales

Average monthly

collectionrate %

102

Competitive Quarterly Competitive Quarterly Year over Year Performance Year over Year Performance

• Signet (U.S.) change in net bad debt as a % of average receivables (annualized)

•Competitive set reported as change in net charge off % of average receivables (annualized)

•Competitive set reported: 2009 annual reports for U.S. charge card performance.

2009-2008

-

100

200

300

400

500

600

700

800

SIGNET (U.S.) CAPITAL ONE BANK OF AMERICA U.S. BANCORP JP MORGANCHASE

CITI TARGET NORDSTROM

Q1 Q2Q3Q4

bps

103

Actions TakenActions TakenChanges in lending decisions

updated scorecard for segment of customer baseadjusted lending decisions on particular characteristicsintroduced down payment requirement for some additional customers

Investment in systems and peopleimproved dialer capabilitynew decision engine technology being introducedenhanced recruitment and training proceduresbetter targeting of resources

Improved customer servicestructured hardship programimproved features on websites

104

Credit Legislation AmendmentsCredit Legislation AmendmentsAdverse impact

reduced ability to charge interest on late payments related to interest free creditcalculation of outstanding balance level of late fees, still open issueelimination of convenience fees

Incremental costsone-off and on-going operational expenses

Limited availability of mitigation strategiesNet direct adverse impact estimated to be $15-$20 million in fiscal 2011

majority of impact on “other operating income”

105

Competitive AdvantageCompetitive AdvantageMost appropriate credit offer, credit being essential in mid market specialty jewelry sector

scale to have jewelry specific systems and modelsmanaged to maximize return to business not to credit activity

Managed to our priorities not those of a third party

106

Bill Montalto Bill Montalto EVP, Chief Operating Officer,EVP, Chief Operating Officer,

Sterling Sterling JewelersJewelers

“Sector Leading Systems”

107

Information Technology & Information Technology & SystemsSystems

Superior systems are competitive advantageBenefits

enhanced customer servicebetter gross merchandise marginmore efficient use of inventorysophisticated customer relationship marketingcredit procedures for specialty jewelry sector

108

Integrated Jewelry Retail Integrated Jewelry Retail SystemsSystems

Retail StoreRetail StoreSystemsSystems

Brick and ClickBrick and ClickMulti ChannelMulti ChannelMarketingMarketing

BusinessBusinessAnalytics and Analytics and Financial Financial ControlsControls

MerchandiseMerchandiseand Supplyand Supply

Chain SystemsChain Systems

Sterling Sterling Systems Systems PortfolioPortfolio

109

Differentiated Systems Differentiated Systems

Highlighted in today’s presentationStore Execution SystemMerchandise Assortment Planning Design-A-Ring

110

Store Execution SystemStore Execution System

Supports leadership position in field execution, communication and training

provides reporting of performanceautomatically identifies outliers from standardeasy to use task listtasks provide detailed step by step proceduresprovides immediate feedback loop

111

Store Execution SystemStore Execution System

112

Store Execution SystemStore Execution System

113

Store Execution SystemStore Execution System.

114

Merchandise Assortment Merchandise Assortment PlanningPlanning

Supports leadership position in jewelry industry

“Pull” merchandise GMROI drivenearly identification of trendscomprehensive testing of new product

115

Merchandise Assortment Merchandise Assortment Planning Planning

Product Bill of Materialdetails the make up of an item product attribute tree

Assortment Planning Systemorganize product in Attribute Clusters cluster stores based on sales volume supports micro-merchandising

Underpins Manufacturing and Diamond Sourcing

116

DesignDesign--AA--RingRing

Available on Jared.com or in storeOver 15,000 loose diamonds available in virtual assortmentView actual diamond with “virtual loupe”technologyOnly US brick & click retailer with this technologyDiamond delivered to home or store

117

118

The Common ThemesThe Common Themes

Systems enabling superior customer service and executionImprove productivity Integrated but responsive systemsUniquely adapted to specialty jewelry sectorContinuous investment and improvement

119

Competitive AdvantagesCompetitive Advantages

Store Operations

Merchandising Marketing Real Estate

• Closely monitored store standards

• Measurable objectives

• Leading training systems

• Differentiated merchandise

• Sophisticated systems

• GMROI focused

• Superior supply chain

• National television advertising

• Research based

• Champion / challenger approach

• Strict criteria, regularly reviewed

• High quality locations & store fit

• Leading store productivity

Control and information systems

Very experienced & stable managementConsistency of strategy & execution

120

Our MissionOur MissionTo earn the trust of our customers by delivering:

To conduct ourselves as a company with:

To achieve:

A superior customerexperience

Teamwork Return onassets

Assistance Integrity Continuous improvement

Products Communications

Services Rewards

Value

Convenience