Tiffany & Co reported double-digit sales and earnings growth for the year ended January 31, 2012. Net sales rose 18 percent to $3.6 billion and net earnings rose 19 percent to $439 million, or $3.40 per diluted share. Net earnings increased 24 percent excluding nonrecurring items and earnings per diluted share rose 23 percent to $3.60.
"Tiffany exceeded the goals that we had set at the start of 2011 for both sales and earnings growth, although we concluded the year with softer-than-expected results. Nonetheless, we remain focused on successfully executing our long-term strategies and pursuing Tiffany's substantial global growth potential in 2012 and beyond,” said company chairman and CEO Michael J. Kowalski.
Worldwide net sales rose 18 percent to $3.6 billion. On a constant-exchange-rate basis that excludes the effect of translating foreign-currency-denominated sales into US dollars, worldwide net sales and comparable store sales rose 15 percent and 13 percent.
Net earnings rose 19 percent to $439 million, or $3.40 per diluted share, compared with $368 million, or $2.87 per diluted share, in the prior year. Net earnings as a percentage of net sales rose to 12.1 percent, from 11.9 percent in the prior year.
Net earnings in fiscal 2011 were reduced by $0.20 per diluted share for nonrecurring items related to the relocation of Tiffany's headquarters staff. Net earnings in fiscal 2010 had been reduced by $0.06 per diluted share for various non-recurring items. Excluding those items, net earnings and net earnings per diluted share rose 24 percent and 23 percent.
During the company’s fourth quarter ended January 31, 2012, worldwide net sales increased 8 percent to $1.2 billion. On a constant-exchange-rate basis, worldwide net sales rose 7 percent and comparable store sales rose 5 percent.
Net earnings declined 2 percent to $178 million, or $1.39 per diluted share, from the prior year's $181 million, or $1.41 per diluted share.
"Over the coming year, as we commemorate the 175th anniversary of Tiffany's founding in 1837, we are confident that Tiffany & Co is better positioned than ever in terms of its increased physical presence and brand awareness around the world, and we are confident in Tiffany's long-term, substantial growth potential," Kowalski said. "Our expansion plans for 2012 include opening a net of 24 stores in important markets, delivering extraordinary product offerings with several new jewellery collections, increasing our marketing spending and providing superior shopping experiences."
While it is obviously still quite early in this new fiscal year, Tiffany said worldwide sales growth is tracking in line with its internal expectations.
"We are now introducing our financial guidance for 2012 which calls for sales growth of approximately 10 percent and net earnings per share in a range of $3.95 - $4.05. We believe our expansion strategies and spending plans are appropriately prudent and will ultimately contribute to strong relative performance within the luxury jewellery industry," Kowalski said.
Global net sales in fiscal year 2012, ending January 31, 2013, is projected to increase by approximately 10 percent. This growth will primarily be driven by sales growth in Asia-Pacific and the Americas, the company said.
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