Tiffany reports seventh successive quarter of falling sales

NEW YORK, NY - JANUARY 12:  A flag for a Tiffany & Co. store hangs along Wall Street in Manhattan on January 12, 2015 in New York City. Shares in the luxury jewelry chain fell on news of weaker than expected holiday sales. Sales in November and December dropped 1 percent to $1.02 billion worldwide.  (Photo by Spencer Platt/Getty Images)

Tiffany & Co. reported its financial results for the three months (second quarter) ended July 31, 2016, citing the seventh successive quarter of falling sales.

Worldwide net sales declined 6% to $932 million (£705m) and comparable store sales declined 8%. On a constant-exchange-rate basis that excludes the effect of translating foreign-currency-denominated sales into U.S. dollars, worldwide net sales and comparable store sales declined 6% and 9%, respectively.

In the UK, sales held up, although total sales in Europe as a whole dropped by 12% to $111 million (£84m). Lower sales in continental Europe were attributed by management to weak demand by foreign tourists and local customers, in contrast to better performance in the United Kingdom.

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Elsewhere the Americas and the Asia-Pacific region were down 9% and 6% respectively. Japan sales increased by 10% compared to the prior year.

Net earnings rose 1% to $106 million from $105 million (£80m) in the prior year. Net earnings declined 5% from the prior-year period’s $111 million, which excludes a specific charge in that period.

Frederic Cumenal, Tiffany & Co. chief executive officer, comments: “The global environment continues to reflect well known challenges that we believe have had broad effects on spending by local customers, as well as foreign tourists, especially from China.

“We are managing expenses efficiently, but also maintaining our marketing spending as a percentage of sales and continuing to invest in key strategic initiatives and opportunities to further strengthen Tiffany’s competitive position among global luxury brands. By delivering extraordinary products and experiences to our customers around the world, we remain focused on growing sales, operating margins and earnings, and creating greater value for stockholders.”

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