Tiffany & Co sparkles in third quarter
Tiffany & Co posted third-quarter profit that beat analyst estimates and boosted its annual earnings forecast as the rising US stock market gave wealthy consumers the confidence to snap up higher-priced luxury items.
The world's second-largest luxury jewellery retailer is benefiting from surging stock prices and rising home values that are bolstering affluent shoppers' willingness to purchase discretionary goods. The company was also helped by price increases and falling precious metal costs.
Net income in the quarter ending October 31 rose 50pc to $94.6m (€70m), or 73 cents a share, from $63.2m a year earlier, the New York-based company said yesterday.
Analysts had projected income to come in at 58 cents. Shares rose 6.2pc to $86 in New York on back of the news.
Profit per share excluding some items will be $3.65 to $3.75 in the year ending January 31, up from a previous forecast of $3.50 to $3.60 a share, Tiffany said. Analysts had estimated $3.62.
The higher prices and lower product costs widened Tiffany's gross margin, or the percentage of sales left after subtracting the cost of the goods, to 57pc from 54.4pc a year earlier. Analysts estimated 55.1pc, on average.
Revenue rose 6.9pc to $911.5m, topping analysts' $889.1m projection.
Tiffany said shoppers were drawn by its expanded fashion jewellery designs, as well as continued growth in fine and statement jewellery, with particular strength in its yellow diamond collection. (Bloomberg)