Tiffany holiday sales jump 8%, thanks to Europe, China
Iconic luxury brand Tiffany & Co. has reported an 8% increase in net revenue during the holiday season. Last Wednesday, the company revealed that growth in China and Europe had sent its sales of jewelry, watches, and its new home accessories range, upwards. Tiffany said that total same-store sales rose 5% during November and December – in the U.S. alone, that figure was 6%. In both Europe and Asia Pacific, however, sales grew by “double-digit” amounts. Internationally, Tiffany has been opening new stores – that’s beginning to pay off, as local customers are beginning to frequent them more regularly.
Tiffany’s share price has risen by 35% over the past 12 months
SOURCE: Yahoo Finance
Tiffany CEO Alessandro Bogliolo contextualized this good news in the wider story of the company’s sales recovery and ongoing strategic plans. He told the press:
"This recent return to growth in worldwide comparable store sales ... is consistent with our commitment to generate solid and sustainable growth in sales, operating margin and earnings that is at least comparable to our industry peers over the long-term. While we are encouraged with the holiday sales results, we believe that the preceding negative comparable store sales trend can only be reversed on a sustainable basis by continuing to evolve our product offerings and customer experience and also by stepping up certain strategic spending in our business."
Looking forward, Tiffany is planning to spend heavily in 2018. The company said technology, marketing, and store presentations would eat up cash in an attempt to reach long-term growth objectives. For 2017, Tiffany said it expects net sales to increase by roughly 4% worldwide. Similarly, in 2018, the company is targeting a “mid-single-digit percentage increase in total sales.”
While investment will eat into profit, the company said tax changes in the U.S. stand out as a potential bright spot. Earnings stand to benefit “in an amount yet to be determined, from an expected lower effective income tax rate,” according to a statement.
Dominion holds Tiffany & Co. in its Global Trends Luxury Fund.
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