UPDATE 3-Signet likely to miss year forecasts, shares slide

(Adds analyst comment, updates shares)

By Mike Elliott

LONDON, Nov 27 (Reuters) - Britain's Signet Group Plc (SIG.L: Quote, Profile, Research, Stock Buzz), the world's biggest speciality jewellery retailer, warned it was likely to miss annual profit forecasts, sending its shares sliding to a near five-year low on Tuesday.

Shares in the retailer shed 18.2 percent to 63.25 pence by 1555 GMT after it reported lower Q3 profit and a weak start to the fourth quarter. The price was the lowest since December 2002 and valued the group at around 1.08 billion pounds ($2.23 billion).

Signet, which trades as Kay Jewelers and Jared the Galleria of Jewelry in the United States where it makes 75 percent of its sales, said pretax profit was $2.5 million in the third quarter, versus $8.0 million last year, due to a challenging U.S. market.

Total sales in the quarter to Nov. 3 increased by 10 percent to $678.7 million.

For the nine-month period, pretax profit slipped to $111.5 million from $113.6 million while total sales increased by 9.4 percent to $2.23 billion.

"In the year to date profit before tax was slightly below last year's level primarily reflecting a more challenging retail marketplace in the United States," Chief Executive Terry Burman said in the results statement.

U.S. sales had weakened further since the end of the third quarter and so far in November like-for-like sales were down around 7 percent, Signet said. There had also been a weakening in Britain as the month progressed.