Despite reporting its seventh-straight quarterly decline in same-store sales, Tiffany & Co. (TIF) - Get Tiffany & Co. Report on Thursday, Aug. 24, reported second-quarter earnings ahead of expectations, a month after adding a new CEO.
During the quarter ending July 31, Tiffany same-store sales fell 2%, while worldwide net sales were up 3% to $959.7 million. Tiffany's earnings of 92 cents per share, or $115 million, were up 9% year over year. Analysts surveyed by FactSet expected Tiffany to report earnings of 86 cents per share on sales of $929.8 million.
Tiffany opened three stores and closed four during the first half of the year, yielding 312 worldwide stores as of July 31. Japan was the only geographic region that saw a same-store sales increase, with comparable sales down in the Americas, Asia-Pacific, Europe and the United Arab Emirates.
For the full 2017 fiscal year, Tiffany expects sales to increase by a low single digit percentage from 2016's sales of $4.105 billion, with earnings increasing a high single digit percentage from the $3.55 per share earned last year. Those assumptions are predicated on Tiffany's expectations that it will open ten new stores, relocate seven and close seven, increasing its worldwide gross retail square footage by 2%.
"While net earnings rose in the first half, we remain determined to drive comparable store sales growth and stronger, sustainable earnings growth through a continued focus on product design innovation in jewelry and luxury accessories, further optimization of our store base, more impactful marketing communications and highly effective customer engagement both in-store and online," interim CEO and board chairman Michael Kowalski said in a statement.
In February, Tiffany ousted Frederic Cumenal, its CEO of less than two years, and added three directors to its board in a settlement with activist investor Jana Partners LLC. Jana, which cemented the $13.7 billion acquisition of Whole Foods Market Inc. (WFM) by Amazon.com Inc. (AMZN) - Get Amazon.com, Inc. Report , held a 4.46% stake as of June 30. Bulgari SpA and Diesel SpA veteran Alessandro Bogliolo was appointed July 13: he takes the helm Oct. 2.
Tiffany shares rose 2.6% to $91.05 in premarket trading Thursday.
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