Tiffany Sales Rise as US, Asia Recover

RAPAPORT... Tiffany's sales jumped 9% in the fourth fiscal quarter, as US and Far East demand strengthened.Global revenue grew to $1.33 billion, the company said Friday. Sales increased 13% year on year to $320 million in the Asia-Pacificregion for the three months ending January 31, while revenue in the Americas climbed 5% to $619 million.However, worldwide comparable-store sales - those atbranches open for at least a year - rose by just 1% at constant currency rates,missing analysts' estimates of a 2.7% gain, according to Bloomberg."We will only be truly satisfied when we create greaterexcitement for our customers, and also generate growth that reflects the fullpotential of our brand," said Tiffany CEO Alessandro Bogliolo.Bogliolo, who joined Tiffany last year, is aiming torevitalize the luxury brand in an attempt to make it more attractive tomillennials. To that end, he outlined several strategic priorities on which itintends to focus, including changes to its products, in-store presentation, andomni-channel customer experience. It also aims to increase its operationalefficiency."We are pleased to be finishing the year with solid salesgrowth, both geographically and across product categories," the executiveadded. "Most important, however, is to generate sustainable growth in sales,margins and earnings over the long term."Profit plummeted 61% to $61.9 million in the fourth quarter,due to charges related to US tax changes. For accounting reasons, Tiffanywill not see a benefit from the Tax Cuts and Jobs Act until its global branchessell off merchandise they have in stock or have ordered, chief financialofficer Marc Erceg explained in an investor call. Without these charges, netprofit would have surged 15% to $208 million.Sales for the full fiscal year increased 4% to $4.17billion, while profit dropped 17% to $370.1 million due tothe tax-related charges. Tiffany expects a "mid-single-digit" percentage increasein sales in the fiscal year ending January 2019. The retailer's share pricefell 5% Friday.Image: J Lekavicius/Shutterstock