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Tiffany's 1Q profit essentially flat; reduces outlook amid slowing demand
NEW YORK (AP) ' Tiffany & Co. cut its outlook for both sales and profit for the year, citing a slowdown in demand for its jewelry not only in the U.S. but in many other countries.
The downbeat outlook delivered Thursday came as the luxury chain reported that its profit for the first quarter was essentially the same as a year ago, hurt by business at home.
Its shares fell more than 8 percent in premarket trading.
Tiffany is considered a key barometer of health for the luxury consumer, so its report raises concerns that weakness in the stock market and an accelerating debt crisis in Europe are making shoppers pull back in spending.
Tiffany said that its net income amounted to $81.5 million, or 64 cents per share in the quarter ended April 30. That compares with $81.1 million, or 63 cents per share, a year ago.
Worldwide revenue rose almost 8 percent to $819.2 million in the quarter. Revenue at stores opened at least a year was up 4 percent. The measure is an indicator of a retailer's health.
Analysts had expected 69 cents per share on revenue of $817.1 million.
The company said that sales in the Americas region, which include the U.S., Canada and Latin America, rose 3 percent to $386 million.
. And sales in Europe rose a 3 percent to $88 million. Sales in the Asia-Pacific region rose 17 percent to $195 million, while sales in Japan soared 15 percent to $142 million.
Tiffany said that it now expects earnings per share to be in the range of $3.70 per share to $3.80 per share for the year. It had originally expected $3.95 per share to $4.05 per share.
Analysts had projected $3.98 per share, according to FactSet.
Tiffany also says that it now anticipates worldwide sales to be up 7 percent to 8 percent, instead of the originally projected 10 percent.
Its shares fell $5.05, or 8.2 percent, to $56.75 per share in premarket trading.