LONDON (Bloomberg) - Signet Group Plc., the world's largest jewellery-store owner, said second-quarter profit fell 48 percent after a slump in US consumer confidence hurt sales.

Net income dropped to $19.1 million, or 1.2 cents a share, in the 13 weeks ended August 2, from $36.7 million, or 2.1 cents, a year earlier, the London-based company said yesterday in a Regulatory News Service statement. Sales at stores open at least a year declined 4.5 percent in the quarter, Signet reported last month.

US consumer confidence fell to the lowest in more than 16 years in June. Shoppers are focusing spending on necessities as companies cut jobs and rising household expenses eat into budgets. Signet competitor Zale Corp. said last week its same-store sales will be unchanged at best in the fiscal year through next July. At the same time, gains by commodity markets have added to jewellers' costs for gold and other precious metals.

"In the short term, the consumer environment in both the US and the UK remains very challenging," Signet CEO Terry Burman said in the statement.

Same-store revenue in the US, where the retailer gets more than 70 percent of sales, fell 5.8 percent in the quarter. In the UK, where Signet owns the Ernest Jones and H Samuel chains, same-store sales declined 0.6 percent.

The operating margin, a profitability gauge, fell to 5.7 percent in the first half from 7.3 percent, Signet said.