Tiffany shines in Q3
Tiffany & Co. reported third-quarter profit and sales that beat Street estimates, as sales strength in its Americas and Asia-Pacific regions helped to offset weakness in Japan.
Net income rose to $100.2 million, or 80 cents a share, for the quarter ended Oct. 31, from $95.1 million, or 76 cents a share, in the year-ago period.
Total net sales grew 3% to $976.2 million, above estimates of $958.3 million. Total same-store sales fell 1%.
"These latest financial results marginally exceeded our expectations, but I believe that Tiffany has the medium to long-term potential to achieve meaningful comparable store sales growth and drive higher operating margins and earnings growth," said Alessandro Bogliolo, CEO, who joined Tiffany in October. "Looking forward, we will increasingly capitalize on the strength of the Tiffany & Co. brand with stronger organizational focus on innovation in product, digital, communication and the customer experience.”
Tiffany's sales in the Americas increased 1% to a better-than-expected $421 million, and Asia-Pacific sales rose 15% to $283 million, also better than expected. Japan sales fell 8% to $139 million, below expectations. Tiffany said the weaker yen against the dollar weighed on results in Japan.
Commenting on the results, Neil Saunders, managing director of GlobalData Retail, noted that Tiffany has come a long way in the past year, starting with improvements in its product. He said that a greater emphasis on fashion and designer collections has generated interest among younger consumer segments.
"As well as using its products to showcase the brand, Tiffany has also upped its game in general marketing and advertising," Saunders said. "These have been more in vogue than past campaigns, and the use of celebrities like Janelle Monáe, Zoë Kravitz, & St. Vincent (Annie Clarke) is helping consumers to see the brand in a new, more modern light."
Saunders said an interesting consequence of the company's "gentle repositioning" is that many of the younger shoppers Tiffany is starting to attract are going online rather than into stores.
"This has resulted in some robust e-commerce numbers," he said. "It is to Tiffany's credit that it has responded by improving the website experience and by increasing the amount of content across its platforms."
Net income rose to $100.2 million, or 80 cents a share, for the quarter ended Oct. 31, from $95.1 million, or 76 cents a share, in the year-ago period.
Total net sales grew 3% to $976.2 million, above estimates of $958.3 million. Total same-store sales fell 1%.
"These latest financial results marginally exceeded our expectations, but I believe that Tiffany has the medium to long-term potential to achieve meaningful comparable store sales growth and drive higher operating margins and earnings growth," said Alessandro Bogliolo, CEO, who joined Tiffany in October. "Looking forward, we will increasingly capitalize on the strength of the Tiffany & Co. brand with stronger organizational focus on innovation in product, digital, communication and the customer experience.”
Tiffany's sales in the Americas increased 1% to a better-than-expected $421 million, and Asia-Pacific sales rose 15% to $283 million, also better than expected. Japan sales fell 8% to $139 million, below expectations. Tiffany said the weaker yen against the dollar weighed on results in Japan.
Commenting on the results, Neil Saunders, managing director of GlobalData Retail, noted that Tiffany has come a long way in the past year, starting with improvements in its product. He said that a greater emphasis on fashion and designer collections has generated interest among younger consumer segments.
"As well as using its products to showcase the brand, Tiffany has also upped its game in general marketing and advertising," Saunders said. "These have been more in vogue than past campaigns, and the use of celebrities like Janelle Monáe, Zoë Kravitz, & St. Vincent (Annie Clarke) is helping consumers to see the brand in a new, more modern light."
Saunders said an interesting consequence of the company's "gentle repositioning" is that many of the younger shoppers Tiffany is starting to attract are going online rather than into stores.
"This has resulted in some robust e-commerce numbers," he said. "It is to Tiffany's credit that it has responded by improving the website experience and by increasing the amount of content across its platforms."