Tiffany results beat, sees gem of a holiday

NEW YORK (BestGrowthStock) – Luxury jeweler Tiffany & Co (TIF.N: ) posted quarterly results that beat Wall Street forecasts and indicated its holiday results would also top expectations on overseas demand and a rebound in the U.S. market.

Tiffany, whose shares rose 3.6 percent in premarket trading, is seeing its aggressive overseas expansion pay off. The jeweler now gets slightly more that half of its sales outside the United States and sales in Asia, excluding Japan, rose 20 percent in the third quarter.

Sales rose 29 percent in Europe, excluding the impact of currency movements.

Global sales at stores open at least a year rose 7 percent. In the Americas, Tiffany reported same-store sales gains of 8 percent as consumers resumed spending on fancier jewelry.

Chief Executive Michael Kowalski said sales growth was “exceeding our expectations” a few weeks into the holiday season, which accounts for one-third of Tiffany’s annual sales.

Tiffany was also able to cope with higher silver and gold costs with an increase in retail prices, which boosted its gross margin 3.7 percentage points to 58.5 percent.

Tiffany reported on Wednesday net income of $55.1 million, or 43 cents per share, for the quarter ended October 31, up from $43.3 million, or 35 cents per share, a year earlier.

Excluding one-time charges, Tiffany reported a profit of 46 cents per share, compared with Wall Street’s expectations of 37 cents.

Total sales rose 14 percent to $681.7 million, surpassing the average Wall Street forecast of $652.8 million, according to Thomson Reuters I/B/E/S.

Signet Jewelers Ltd (SIG.N: ) also posted strong results on Tuesday, saying same-store sales jumped 14.3 percent at its higher end Jared chain during its most recent quarter.

Tiffany said it expected worldwide sales will rise 12 percent during the holiday quarter and raised its full-year profit forecast range by 12 cents to $2.72 to $2.77 per share, excluding items. On average, analysts have been expecting $2.64 per share.

Tiffany, which operates 225 stores globally, opened two new U.S. stores, and another store in Taipei. Sales at Tiffany’s flagship store on Manhattan’s Fifth Avenue fell 3 percent.

Shares were up 3.6 percent, or $2.09, to $60.36 in premarket trading.

(Reporting by Phil Wahba, editing by Gerald E. McCormick and Derek Caney)

Tiffany results beat, sees gem of a holiday