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Tiffany earnings beat Wall Street view
Tiffany & Co posted higher-than-expected quarterly profit today as increased sales overseas and at new stores helped offset the effects of a weak US economy that has put a strain on consumer spending.
Shares of the jewelry company rose more than 11 per cent in premarket trade after it also said it expected robust growth in markets other than the United States and Japan.
Tiffany, like mid-tier rivals Zale Corp and Finlay Enterprises Inc, saw sales at established stores drop in the key November-December holiday period as shoppers held on to their spare dollars or spent them on day-to-day items like food and fuel.
Net income fell 16 per cent to $118.3 million, or 89 cents a share, in the fourth quarter ended on January 31st from $140.5 million, or $1.02 a share, a year earlier. But excluding special items, earnings were $1.27 a share, 6 cents higher than the analysts' average forecast compiled by Reuters Estimates.
Items included charges for discontinuing some watch models after a tie-up with Swatch and loans made to Tahera Diamond Corp. Sales rose 10 per cent, or 7 per cent on a constant-currency basis, to $1.05 billion. For the current fiscal year, the New York-based jeweler said it expected net earnings per share to rise by 11 per cent to 15 per cent to a range of $2.75 to $2.85.
Tiffany expects overall sales growth of about 10 per cent for the year. It reported net sales of $2.94 billion for the previous 12 months. The company forecast low-single-digit growth in US same-store sales and mid-single-digit growth internationally.
Tiffany shares rose to $43 in trading before the market opened from Thursday's close of $38.60.
