Tiffany & Co lifts profit forecast as shoppers return to luxury
US jewellery company Tiffany & Co lifted its profit guidance on the back of stronger than expected holiday sales, a sign that some shoppers have regained enough confidence to return to luxury purchases.
Chief executive and chairman Michael Kowalski said, "We are very pleased with this worldwide sales growth, and with the increases we saw in every region in both months of the holiday period. Healthy sales growth was seen across most product categories, with particular strength in Tiffany's fine jewellery collections, diamond engagement rings and fashion gold jewellery, although with limited growth in silver jewellery sales."
He added, "Based on these better-than-expected results, Tiffany is on track to achieve record sales and earnings (excluding nonrecurring items) in the fiscal year ending January 31, 2011. We now expect net sales of almost US$3.1 billion and net earnings from continuing operations (excluding nonrecurring items) of US$2.83 - $2.88 per diluted share, versus a previous forecast made in November of US$2.72 - $2.77."
Worldwide sales for the two month holiday period to December 31 rose 11 per cent to US$888.5 million. The company said sales grew the most in the Asia-Pacific region, up 23 per cent to US$138.9 million, while sales in Japan rose 11 per cent to US$142.5 million. Sales climbed 13 per cent to US$114.9 million in Europe and 9 per cent to US$484.8 million in the Americas.
In a statement, the company said other sales declined 45% to US$7.4 million - the result of an expected decrease in wholesale sales of rough diamonds (following higher-than-normal sales in the previous year), partly offset by increased wholesale sales of finished goods to independent distributors within emerging markets.
Tiffany, which had 232 stores as of Dec 31, is expected to release its full year figures on March 21. New Zealanders wanting to get their hands on the famous blue boxes must travel to Australia for the nearest shop or choose their bling online.