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Articles from FASHION JEWELLERY (276 Articles)

Tiffany reported a strong performance for 2014 but predicted a weak first half for 2015
Tiffany reported a strong performance for 2014 but predicted a weak first half for 2015

Tiffany & Co forecasts challenging year

Tiffany & Co has reported strong 2014 results for the Asia-Pacific region, with “noteworthy” sales in Australia, but has indicated it may not perform as well globally in the coming year.

For the full year ended 31 January 2015, Tiffany recorded a 10 per cent increase in total sales and a 4 per cent rise in same-store sales for the Asia-Pacific region.

Michael Kowalski, Tiffany chairman and CEO
Michael Kowalski, Tiffany chairman and CEO

According to its financial report, the company had experienced “noteworthy sales growth” for the fourth quarter in Australia, China and Singapore and “softness” in Hong Kong.

Globally, Tiffany’s net sales increased 5 per cent to US$4.25 billion (AU$5.4 b) with same-store sales also up 4 per cent.

“2014 was a successful year for our company with meaningful progress made by our global team,” Tiffany chairman and CEO Michael Kowalski commented. “We expanded our store base, introduced compelling new jewellery designs and strengthened customer awareness. And we achieved very healthy growth in net sales and earnings for the year.”

Increased sales were also reported across the company’s major operating regions: revenue in the Americas rose 6 per cent, Japan was up 4 per cent and Europe increased 6 per cent. Combined sales across all other regions rose 26 per cent.

In addition, it was noted that globally, the company benefited from a favourable shift in a “product sales mix of higher-margin fashion jewellery”.

First-half pressures

Worldwide net earnings (excluding charges) for the company were US$545 million (AU$696 m), 13 per cent higher than the previous year’s US$481 million (AU$614.6 m).

Frederic Cumenal, Tiffany president
Frederic Cumenal, Tiffany president

However, the 2015 forecast did indicate that the first half of the year would not fare as well, predicting a 30 per cent decrease in first quarter net earnings, with “a more modest decline” expected to follow in the second quarter. Predictions for the third and fourth quarters were more positive with double-digit percentage net earnings increases anticipated.

“By now it should be clear that Tiffany is facing challenges from global economic uncertainties, especially from the effect of a strong US dollar on the translation of foreign-denominated sales into dollars and on foreign tourist spending in the US,” Tiffany president Frederic Cumenal explained.

“As a result, we have adopted a cautious approach in our planning for the coming year, anticipating modest growth in net sales and minimal net earnings growth for the full year.”

Cumenal added that plans for 2015 included the introduction of new jewellery and watch designs – including the CT-60 watch collection, which he said would be launched next month – as well the opening of between 12 and 15 stores in 2015.

At the end of January 2015, Tiffany operated 295 stores – 122 in the Americas, 73 in Asia-Pacific, 56 in Japan, 38 in Europe, five in the United Arab Emirates and one in Russia.

More reading
Tiffany & Co sales up in Asia-Pacific
Tiffany sales success led by fashion jewellery
Strong Aussie demand for Tiffany & Co
Tiffany & Co sales on the rise again

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Thursday, 12 December, 2019 09:51pm
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