Strong Christmas for Tiffany as Sales Rise 12%

Beating the U.S. retail average, luxury jeweler Tiffany & Co reported a good Christmas holiday season with net sales in the vital November 1 - December 31 period increasing 12 percent over the year-earlier period to $673.8 million while worldwide same store sales rose 6 percent.

 

Tiffany said holiday demand was boosted by interest in diamond jewelry and new products, including its ATLAS jewelry collection.

Tiffany said it saw strong holiday purchases at all levels above $500 as well as above the $10,000 mark. The high-end jeweler benefited from the weak dollar which boosted sales to tourists at its New York flagship store but at the same time it hurt results in Japan, Tiffany’s long-time Achilles heel.

In the United States, sales rose 11 percent, to $340.8 million, while U.S. same-store sales increased 8 percent. Internationally, same-store sales edged down 2 percent, with a 7 percent decline in Japan, the most important market after the United States, bearing heavily on results.

Tiffany chairman and chief executive Michael Kowalski said the sales results positioned the company to end the year on a strong note.

"These results keep us on track to achieve the earnings expectation that we announced in November," he said.

"Overall, our preliminary expectations for 2005 call for growth of 8 percent to 10 percent in net sales and 10 percent to 12 percent in net earnings," he said.

Tiffany plans to open at least three stores in the United States - two in California and one in Florida - and several internationally this year, Kowalski said.

He also remains optimistic concerning the Japanese market, saying that despite challenging market conditions, he believes the firm's initiatives with new stores and products will ultimately lead to an improved performance.