Tiffany & Co. reported that its first quarter revenue rose 7.6 percent year on year to $819.2 million for the period that ended on April 30, 2012. Same-store sales worldwide rose 4 percent. Cost of sales jumped 10 percent to $350.2 million and gross margin as a percentage of sales fell to 57.3 percent from 58.3 percent one year ago. Profit was flat at $81.5 million or 64 cents per share.
While sales were
only 3 percent higher in the Americas at $386 million, Tiffany & Co.
reported a solid 16 percent increase --at a constant exchange rate--
for sales in the Asia-Pacific region at $195 million, and a 13 percent
jump in revenue for Japan at $142 million. Sales across Europe rose 7
percent as measured by local currency to $88 million. Same-store sales
at a constant exchange-rate in the Americas fell 1 percent and in Europe
they dropped 4 percent from one year ago, however, comparable-store
sales rose 10 percent for Asia-Pacific and 12 percent for Japan.
J. Kowalski, the chairman of Tiffany & Co., said, "In terms of our
sales for the first quarter, regions outside the Americas performed
generally as expected. However, the Americas region underperformed,
continuing a soft trend that began in the last quarter of 2011 and
compounded by the difficult comparison to substantial sales growth in
last year's first quarter. These sales results led to net earnings
modestly trailing our expectations."
Tiffany's net inventory
increased 27 percent year on year to $2.2 billion in the quarter.
Finished goods inventories increased 16 percent due to higher product
acquisition costs, expanded product assortments and new store openings,
as well as some effect from weaker sales growth. Tiffany stated that a
44 percent increase in raw material and work-in-process inventories
reflected higher product acquisition costs, expanded rough diamond
sourcing and internal manufacturing.
Cash and equivalents and
short-term investments totaled $343 million compared with $622 million
one year ago. Short-term and long-term debt totaled $834 million on
April 30, which was up from $687 million in 2011.
that Tiffany was updating its forecast for the full year to reflect the
first quarter results along with lower near-term expectations.
''Although we are very early into the second quarter, worldwide sales
are currently increasing by a low-single-digit percentage, reflecting
difficult year-over-year comparisons and decelerating rates of economic
growth in many countries. In 2011, we achieved extremely strong sales
growth in the second and third quarters, especially in the Americas and