March 2, 2021

Tiffany’s Net Income Rises 30 Percent

Tiffany Company’s net income rose 30 percent in the second quarter, propelled by strong growth across all regions as high-income shoppers continued to be drawn to its jewelry and other goods.

The results handily beat Wall Street’s expectations, and the company raised its full-year profit forecast again as a result. Tiffany said it earned $90 million, or 69 cents a share, in the quarter, up from $67.7 million, or 53 cents a share, a year earlier.

Excluding 16 cents a share in costs tied to relocating its New York headquarters employees, adjusted profit totaled 86 cents a share, topping the 70 cents that analysts surveyed by FactSet had forecast.

Revenue in the period, which ended July 31, rose 30 percent to $872.7 million, which was well above the $785.6 million that Wall Street predicted.

Stock in Tiffany rose $5.90, or 9.3 percent, to $69.01 a share.

Mark L. Aaron, vice president for investor relations, said in a conference call that sales across all jewelry categories rose more than 10 percent.

High-end, engagement and gold jewelry all sold well, Mr. Aaron said. Silver jewelry, which sold well during the recession since it is relatively lower priced, posted a “reasonably good” sales increase, he added.

Rising diamond and precious metal costs have prompted Tiffany to raise some prices. Mr. Aaron said the price increases had occurred in most regions this year.

The chief operating officer, James N. Fernandez, said rough diamond prices had climbed nearly 40 percent in the last year.

“The outlook for diamonds over the long term certainly looks as though rising global demand will continue to put pressure on supply and therefore price,” he explained.

Tiffany’s best performance in the quarter came in the Asia-Pacific region, where sales surged 55 percent to $173.2 million on strong performances in China and Korea. Sales in Europe rose 32 percent. Foreign tourists, particularly those from China and Russia, contributed to the increase in Europe, the company said.

Sales in the Americas, which comprises the United States, Canada and Latin America, gained 25 percent.

Sales at the company’s flagship New York store, a favorite of foreign tourists, rose 41 percent, Mr. Aaron said.

Even Japan, which is still regaining its footing after an earthquake, tsunami 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,” the chief executive, Michael J. Kowalski, said in a statement.

Revenue at stores open at least a year increased 22 percent. Mr. Kowalski said the retailer’s first-half performance raised confidence about the rest of the year, even though economic uncertainty remained.

Tiffany is now predicting that its full-year earnings will be $3.65 to $3.75 a share, compared with a previous forecast of $3.45 to $3.55 a share.

Analysts foresee earnings of $3.55 a share.

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