Tiffany & Co  reporting  its financial results for the three months (second quarter) and six months (first half) ended July 31, 2018, said that “Higher earnings in both periods resulted from broad-based growth in worldwide sales, increases in gross margin and lower effective tax rates, partly offset by higher investment spending”.

The Company stated that these “better-than-expected results” led management to increase its net earnings outlook for the full year ending January 31, 2019 (fiscal 2018).

Reporting second quarter results,  Tiffany said its worldwide net sales rose 12% to US$ 1.1 billion. The increase reflected “geographically broad-based growth and increases in all product categories”, the Company noted. Comparable sales rose 8%.

“On a constant-exchange-rate basis that excludes the effect of translating foreign-currency-denominated sales into U.S. dollars….worldwide net sales rose 11% and comparable sales rose 7%,” Tiffany stated.

For the period, the Company reported an increase in net earnings by a creditable 26% to US$ 145 million, or US$ 1.17 per diluted share; from US$ 115 million, or US$ 0.92 per diluted in the comparable period of the previous year.

For the first half, Tiffany’s worldwide net sales increased 13% to US$ 2.1 billion, which the Company again attributed to “geographically broad-based growth and increases in all product categories”; while comparable sales increased 9%.

“On a constant-exchange-rate basis, worldwide net sales and comparable sales rose 11% and 7%, respectively,” the Company said about first half sales.

For the period, the Company’s net earnings increased 38% to US$ 287 million, or US$ 2.31 per diluted share, from US$ 208 million, or US$ 1.66 per diluted share, for the same period of the previous year.

Reporting its  sales regionwise,  Tiffany said that in the Americas, total net sales rose 8% to US$ 475 million in the second quarter and 8% to US$ 900 million in the first half; comparable sales rose 8% and 9%, respectively. 

For Asia-Pacific, Tiffany reported total net sales increase of  28% to US$ 301 million in the second quarter and 28% to US$ 629 million in the first half. 

Tiffany’s total net sales in Japan  increased 11% to US$ 155 million in the second quarter and 14% to US$ 305 million in the first half. Comparable sales rose 9% and 12%, respectively.   

 In Europe, total net sales rose 5% to US$ 121 million in the second quarter and 9% to US$ 228 million in the first half, Tiffany reported. This reflected :the positive effects from currency translation, as well as sales in new stores, and comparable sales declined 1% and rose 1%, respectively”, the Company added. On a constant-exchange-rate basis, total sales rose 2% in both the second quarter and first half; while comparable sales declined 4% and 6%, respectively.

“Sales results were negatively affected in both the second quarter and first half by broad-based regional softness, which management attributed to lower spending by foreign tourists; comparable sales were also affected by negative effects from new stores on existing store sales,” Tiffany remarked regarding its   performance in Europe.

“Other net sales declined 21% in both the second quarter and first half to US$ 24 million and US$ 46 million, respectively, primarily due to a reduction in wholesale sales of diamonds,” Tiffany reported. “Comparable sales rose 5% in the second quarter and declined 2% in the first half.”

The Company said that sales growth was seen across all product categories.

After opening seven Company-operated stores in the first half and closing two in the first half, as at July 31, 2018, the Company operated 320 stores (123 in the Americas, 90 in Asia-Pacific, 54 in Japan, 48 in Europe, and five in the UAE), versus 312 stores a year ago (124 in the Americas, 85 in Asia-Pacific, 54 in Japan, 44 in Europe, and five in the UAE).

 Alessandro Bogliolo, Chief Executive Officer, said, “While in the early stages of addressing our six key strategic priorities, we are pleased with initial customer reactions to our new communication, product and in-store initiatives.”  

He added, “We are pleased with our sales and earnings growth and the strength and breadth of the results in the first half of 2018, but it’s worth noting that strategic investment spending is increasing for the remainder of the year, as expected, which is intended to support longer-term sustainable growth. Regarding that longer-term horizon, we are very excited to embark on our recently announced transformative multi-year remodeling of the New York City flagship building. We believe that the thoughtful combination of making short- and long-range strategic investments is necessary to achieve the full growth potential of this legendary brand.”