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Tiffany Sales Climb as US, Asia Recover
Mar 18, 2018 4:08 AM
By Rapaport News
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RAPAPORT... Tiffany’s sales jumped 9% in the fourth fiscal quarter, as US and Far East demand strengthened.
Global revenue grew to $1.33 billion, the company said Friday. Sales increased 13% year on year to $320 million in the Asia-Pacific
region for the three months ending January 31, while revenue in the Americas climbed 5% to $619 million.
However, worldwide comparable-store sales — those at
branches open for at least a year — rose by just 1% at constant currency rates,
missing analysts’ estimates of a 2.7% gain, according to Bloomberg.
“We will only be truly satisfied when we create greater
excitement for our customers, and also generate growth that reflects the full
potential of our brand,” said Tiffany CEO Alessandro Bogliolo.
Bogliolo, who joined Tiffany last year, is aiming to
revitalize the luxury brand in an attempt to make it more attractive to
millennials. To that end, he outlined several strategic priorities on which it
intends to focus, including changes to its products, in-store presentation, and
omni-channel customer experience. It also aims to increase its operational
efficiency.
“We are pleased to be finishing the year with solid sales
growth, both geographically and across product categories,” the executive
added. “Most important, however, is to generate sustainable growth in sales,
margins and earnings over the long term.”
Profit plummeted 61% to $61.9 million in the fourth quarter,
due to charges related to US tax changes. For accounting reasons, Tiffany
will not see a benefit from the Tax Cuts and Jobs Act until its global branches
sell off merchandise they have in stock or have ordered, chief financial
officer Marc Erceg explained in an investor call. Without these charges, net
profit would have surged 15% to $208 million.
Sales for the full fiscal year increased 4% to $4.17
billion, while profit dropped 17% to $370.1 million due to
the tax-related charges. Tiffany expects a “mid-single-digit” percentage increase
in sales in the fiscal year ending January 2019. The retailer’s share price
fell 5% Friday.
Image: J Lekavicius/Shutterstock
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Tags:
Alessandro Bogliolo, Asia-Pacific, Bloomberg, Marc Erceg, Rapaport News, Tax Cuts and Jobs Act, Tiffany, US
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