Signet Accused of Failing to Reveal True Negative Impact of its IT System Conversion
According to the complaint, on October 23, 2017, Signet announced the successful completion of the first phase of the company’s strategic outsourcing of its in-house credit program. Signet emphasized that it “has allowed us to reduce our outstanding debt and return capital to our shareholders.” While touting the promising potential of the company’s new credit program, Signet failed to disclose that the magnitude of in-store process changes related to the program were negatively impacting sales. On November 21, 2017, Signet revealed that its Q3 2017 same store sales were down five percent due to disruptions in the company’s IT systems and processes during the credit outsourcing transition. On this news, Signet’s stock fell $23.05 per share, or over 30%, to close at $52.79 per share on November 21, 2017.