Strong Asia Pacific sales help Tiffany
NEW YORK, USA
TIFFANY & Co’s third-quarter net income climbed 50 per cent, buoyed by strong sales in the Asia-Pacific region.
Its performance topped Wall Street’s expectations, and the luxury retailer yesterday raised its full-year adjusted earnings forecast above analysts’ estimates. Shares climbed almost eight per cent trading on the news.
Tiffany’s results come as the holiday shopping kicks off into high gear later this week. The jewellery chain is considered a barometer of luxury spending. The latest results show that the affluent continue to spend, bolstered by a stock market that is reaching new highs.
“Despite the obvious economic and consumer uncertainties in some regions, our management team see great opportunities ahead of us,” Jim Fernandez, Tiffany’s executive vice-president and chief operating officer, told investors.
Chairman and CEO Michael Kowalski said in a statement that shoppers are responding well to its expanded fashion jewelry designs, which includes the Atlas collection. He said that the company is also experiencing improved sales of fine and statement jewellery, with particular strength in its yellow diamond collection.
Tiffany earned US$94.6 million, or 73 cents per share, for the three months that ended October 31. That compares with US$63.2 million, or 49 cents per share, a year ago.
Analysts polled by research firm FactSet expected earnings of 58 cents per share, on average.
Revenue for the New York company rose seven per cent to US$911.5 million from US$852.7 million, with Asia-Pacific sales up 27 per cent. This topped the US$888.4 million Wall Street predicted.
Sales in the Americas climbed four per cent to US$417 million, while European sales climbed seven per cent to US$104 million. Sales in Japan fell 13 per cent to US$128 million, hurt by a weaker yen.
Revenue at stores open at least a year, a key indicator of a retailer’s health, increased seven per cent. Analysts projected a 4.5 per cent increase. This figure excludes results from stores recently opened or closed.
Tiffany now foresees fiscal 2013 adjusted earnings of US$3.65 to US$3.75 per share. Its prior guidance was for US$3.50 to US$3.60 per share.
Analysts expect full-year earnings of US$3.62 per share.
Tiffany’s shares rose US$6.22 to US$87.21 in morning trading. Its shares have risen more than 41 per cent so far this year.