Thursday, June 2, 2011

Tiffany & Co reports sharp rise in first quarter net profit to $81.1 million

Luxury jewellery retailer Tiffany & Co has posted net profit of $81.1 million, or 63 cents per share, up from $64.4 million, or 50 cents per share, a year earlier for the quarter ending April 30.

The retailer reported a sales jump of 20 percent to $761 million. Stripping out currency changes, sales increased by 16 percent.

The firm said that gross margin rose to 58.3 percent from 57.8 percent, and that total same-store sales rose 19 percent, or 15 percent on a constant-exchange-rate basis.

Tiffany reported that all global markets saw double-digit sales growth, including a 19 percent increase in the Americas, a 37 percent jump in the Asia-Pacific region and a 25 percent increase in Europe.

Tiffany said it was raising its full-year earnings estimate to a range of $3.45 to $3.55 a share from its March forecast of $3.35 to $3.45.

Tiffany's results are being boosted by higher discretionary spending by wealthier consumers buying premium diamond and gold jewellery, as well as appealing to more middle-range, aspirational consumers.

"Worldwide sales growth in the early part of this second quarter is continuing to exceed our expectation, with solid performance in most regions," said Michael J. Kowalski, chairman and chief executive officer.

Tiffany had previously announced that store closings caused by the earthquake and tsunami in Japan would hit earnings by five cents a share. The stores have since re-opened and Japan sales rose 7 percent to $123.4 million in the quarter.

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