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Tiffany & Co. 2nd-quarter profit jumps 30 percent on overseas growth; lifts full-year guidance
NEW YORK (AP) ' Tiffany & Co.'s net income jumped 30 percent in the second quarter, led by strong growth overseas as high-income shoppers continued to be drawn to its jewelry and other goods.
The New York company's results handily beat Wall Street's expectations, and it raised its full-year profit forecast on the better-than-expected performance. Tiffany's stock surged $3.88, or 6.2 percent, to $66.99 in premarket trading.
The retailer, which is known for its turquoise boxes, has a customer base that leans heavily toward high-income consumers who gravitate toward its luxury goods. Spending on luxury items has rebounded faster than other segments as wealthier consumers feel more confident in making purchases, boosting earnings for companies like Tiffany.
Tiffany earned $90 million, or 69 cents per share, for the period ended July 31. That's up from $67.7 million, or 53 cents per share, a year earlier.
Excluding 16 cents per share in relocation-related costs, adjusted profit totaled 86 cents per share.
This easily beat the 70 cents per share that analysts surveyed by FactSet forecast.
Revenue rose 30 percent to $872.7 million, which was well above the $785.6 million that Wall Street predicted.
The best performance was in the Asia-Pacific region, where sales surged 55 percent to $173.2 million. Sales in Europe rose 32 percent, while sales in the Americas gained 25 percent. Even Japan, which is still regaining its footing following an earthquake and nuclear scare earlier this year, posted a 21 percent sales increase.
"We are extremely pleased by these results which confirm the growing global appeal of Tiffany's product offerings," Chairman and CEO Michael Kowalski said in a statement.
Revenue at stores open at least a year increased 22 percent. This metric is a key gauge of a retailer's performance because it excludes results from stores recently opened or closed.
Kowalski said the retailer's first-half performance is allowing the company to stay confident about its potential for the rest of the year, even though economic uncertainty remains.
Tiffany is now predicting is full-year earnings will be between $3.65 and $3.75 per share, compared with a previous forecast of $3.45 to $3.55 per share. The guidance assumes a high-teens percentage increase in revenue.
Analysts foresee earnings of $3.55 per share.