Tiffany exceeds expectations with Q1 sales up 9%

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Brand says Great Gatsby partnership boosts interest; Europe up 6%.

Tiffany & Co. has enjoyed growth in Europe in the first quarter, according to its latest financial results released today.

The US jewellery brand’s sales grew 6% in Europe in Q1, totalling US$93 million (£61.8m). On a constant-exchange-rate basis, total sales and comparable store sales rose 8% and 6% respectively.

In the three months ended April 30 Tiffany’s worldwide net sales increased 9% to $895 million (£595m). On a constant-exchange-rate basis its worldwide net sales increased 13% and comparable store sales rose 8%.

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Tiffany’s net earnings increased 3% to $84 million (£55m).

Michael J. Kowalski, chairman and chief executive officer, said: "We are pleased with this start to the year. Worldwide, first quarter sales exceeded our expectations, enabling us to improve our sales leverage on fixed expenses and achieve earnings growth.

"In addition, we celebrated Tiffany’s 175th anniversary with our very successful Blue Book event and promotional activities surrounding the debut of the film The Great Gatsby, for which we designed the jewellery."

In the Americas total sales rose 6% to $408 million (£271m) with same store sales up 3%. The brand reported "relatively stronger" growth at its New York flagship store.

In the Asia-Pacific region, total sales of $223 million (£148m) were 15% higher than a year ago. On a constant-exchange-rate basis, total sales increased 14%, due to sales growth in Greater China and most other countries, and comparable store sales rose 9%.

Total sales in Japan increased 2% to $145 million (£96.3m). On a constant-exchange-rate basis, total sales increased 20% and comparable store sales rose 21% due to particularly strong growth in Tiffany’s engagement and higher-end jewellery categories.

Other sales tripled to $27 million from $9 million in the prior year, primarily reflecting the conversion in July 2012 of five Tiffany & Co. stores in the United Arab Emirates from independently-operated to company-operated.

Kowalski added: "While first quarter sales and earnings exceeded our expectations, we are maintaining our earnings forecast for the full year, mindful of continuing soft sales results in the Americas and the negative translation effect of a weaker yen.

"However, we remain focused on exciting initiatives for this year, including jewellery introductions highlighted by our Great Gatsby and Ziegfield collections, the Harmony engagement ring and a reinterpretation of our iconic Atlas collection. Tiffany’s global store base is growing this year with a planned net addition of 14 stores, and we will be launching our redesigned website later this year."
 

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