Tiffany & Co. (NYSE: TIF) today reported that in its third quarter worldwide net sales were $853 million and net earnings were $63 million, or $0.49 per diluted share. Management updated its full year financial outlook.
In the three months (“third quarter”) ended October 31, 2012:
- Worldwide net sales increased 4% to $853 million. On a constant-exchange-rate basis that excludes the effect of translating foreign-currency-denominated sales into U.S. dollars (see “Non-GAAP Measures” schedule), worldwide net sales rose 5% and comparable store sales increased 1%.
- Net earnings declined 30% to $63 million, or $0.49 per diluted share, versus $90 million, or $0.70 per diluted share, in last year’s third quarter.
In the nine months (“year-to-date”) ended October 31, 2012:
- Worldwide net sales of $2.6 billion were 4% higher than last year. On a constant-exchange-rate basis, worldwide net sales rose 5% and comparable store sales rose 1%.
- Net earnings declined 9% to $237 million, or $1.85 per diluted share, from $261 million, or $2.02 per diluted share, last year.
- Net earnings in 2011’s comparable nine-month period had included $26 million, or $0.20 per diluted share, for nonrecurring items related to the relocation of Tiffany’s New York headquarters staff. Excluding those nonrecurring items, net earnings would have been 18% below last year.
Michael J. Kowalski, chairman and chief executive officer, said, “Three months ago, we had anticipated that third quarter results would be affected by continued economic weakness in many markets as well as by challenging comparisons to last year when net sales were up 21% and net earnings had increased 52% excluding nonrecurring items. However, gross margin was weaker than we expected and Tiffany’s effective tax rate was higher than we expected. As a result, net earnings were below our expectations.”