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President-elect impacting Tiffany flagship


Tiffany & Co.’s sterling jewel — its flagship on Manhattan’s Fifth Avenue — is feeling the impact of beefed up security and protests at Trump Tower, which is located next door to the store.

Since the election, Tiffany said its flagship, the retailer’s largest location and a tourist magnet, has seen an “adverse effect” and sales softness” compared with the year before and relative to the company’s other U.S. stores. And it sees no quick fix of the problem.

“The company cannot provide any assurance that sales in that store will not be negatively affected by this activity in the fourth quarter or in any future period,” the retailer said in a statement.

The warning came as Tiffany posted better-than-expected sales and profit for its third quarter (which ended before the election), largely on stronger business in Asia.

Tiffany reported that sales rose 1.2% to $949.3, its first increase in eight quarters. Net earnings rose 5% to $95.1 million, or 76 cents per share.

Tiffany has been working to improve its business, which has been in a slump for the past two years, partially hurt by fluctuations in currency and a slowdown in fine jewelry spending.

Commenting on the third quarter, Tiffany CEO Frederic Cumenal said the company was encouraged by some early signs of improvement, but needed more positive data over time “before this can be considered an inflection point.”

“In this recent quarter, we saw a smaller sales decline in the U.S. from earlier this year, while Asia-Pacific results reflected strong growth in mainland China and a relatively smaller decline in Hong Kong,” he said. “Our business in Japan performed well which we attribute to spending by domestic consumers, but we believe the strengthening of the yen has negatively impacted purchases by Chinese consumers. We also saw relative strength in U.K. sales, but a continuation of softness on the European continent.”

Looking ahead, the retailer continues to expect a full-year drop in sales and profit as it continues facing a tough market.
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