Tiffany & Co reports solid sales growth in second quarter 2014
Tiffany & Co reports for its fiscal second quarter ended July 31 net earnings increase by16% due to a 7% increase in worldwide net sales and a higher gross margin. Management increased its earnings forecast for the current fiscal year by five cents per share.
Tiffany’s worldwide net sales increased 7% to $993 million. On a constant-exchange-rate basis excluding the effect of translating foreign-currency-denominated sales into U.S. dollars, worldwide net sales increased 7% and comparable store sales increased 3% largely due to growth in the Americas and Asia-Pacific regions.
Net earnings rose 16% to $124 million, or $0.96 per diluted share, compared with $107 million, or $0.83 per diluted share, in last year’s second quarter, benefiting from the sales growth and a higher gross margin.Worldwide net sales rose 10% to $2.0 billion. On a constant-exchange-rate basis, worldwide net sales rose 11% due to sales growth in all regions and comparable store sales rose 7%.
In the Americas, total sales rose 9% in the second quarter to $484 million and increased 8% in the first half to $922 million. In Asia-Pacific, total sales increased 14% in the second quarter to $237 million and rose 15% in the first half to $498 million. In Japan, total sales declined 13% in the second quarter to $119 million (a 10% decline on a constant-exchange-rate basis).
The increases were primarily due to retail sales growth reflecting the opening of the first Company-operated TIFFANY & CO. store in Russia, as well as 2% and 10% comparable store sales growth in the United Arab Emirates. During the second quarter, Tiffany opened one store in the Americas in Aventura, Florida; it has opened five stores in the first half.
At July 31, 2014, Tiffany operated 293 stores (122 in the Americas, 72 in Asia-Pacific, 55 in Japan, 38 in Europe, five in the U.A.E. and one in Russia), versus the prior year’s 277 stores (116 in the Americas, 67 in Asia-Pacific, 54 in Japan, 35 in Europe and five in the U.A.E.).
For the fiscal year ending January 31, 2015, Tiffany & Co will open 10 directly operated stores and close three existing stores: opening four in the Americas, two in Asia-Pacific, two in Japan, and one each in Europe and Russia, while closing one each in the Americas, Asia-Pacific and the U.A.E.