Tiffany Worldwide Sales Rise 12% in Q2
Tiffany & Co reported its financial results for the three months, Q2 and six months ended. Higher earnings in both periods resulted from broad-based growth in worldwide sales, increases in gross margin and lower effective tax rates, partly offset by higher investment spending.
These better-than-expected results led management to increase its net earnings outlook for the full year ending January 31, 2019 i.e fiscal 2018.
In the Q2 worldwide net sales rose 12% to $1.1 billion, reflecting geographically broad-based growth and increases in all product categories; comparable sales rose 8%. On a constant-exchange-rate basis that excludes the effect of translating foreign-currency-denominated sales into U.S. dollars, worldwide net sales rose 11% and comparable sales rose 7%.
Net earnings rose 26% to $145 million, or $1.17 per diluted share, from $115 million, or $0.92 per diluted share, a year ago.
In the first half- H1, worldwide net sales increased 13% to $2.1 billion, due to geographically broad-based growth and increases in all product categories; comparable sales increased 9%. On a constant-exchange-rate basis, worldwide net sales and comparable sales rose 11% and 7%, respectively.
Net earnings increased 38% to $287 million, or $2.31 per diluted share, from $208 million, or $1.66 per diluted share, a year ago.
Alessandro Bogliolo, Chief Executive Officer, said, “While in the early stages of addressing our six key strategic priorities, we are pleased with initial customer reactions to our new communication, product and in-store initiatives. The launch of Paper Flowers, a floral collection in platinum and diamonds, is moving toward full global distribution and we believe our evolved brand message is gaining momentum.
Our activities in these areas will further accelerate in the remainder of the year with special focus on product personalization, high jewelry, a whimsical holiday campaign and the unveiling in North America of Tiffany True, an innovative diamond ring concept.” He added, “We are pleased with our sales and earnings growth and the strength and breadth of the results in the first half of 2018.
But it’s worth noting that strategic investment spending is increasing for the remainder of the year, as expected, which is intended to support longer-term sustainable growth. Regarding that longer-term horizon, we are very excited to embark on our recently announced transformative multi-year remodeling of the New York City flagship building.
We believe that the thoughtful combination of making short- and long-range strategic investments is necessary to achieve the full growth potential of this legendary brand.”
