Tiffany Has Gem of a First Quarter

Tiffany & Co. (New York) reports net sales grew 20 percent worldwide in the first quarter ended April 30, 2011.

“We are pleased with the very strong start to the year,” says Michael Kowalski, chairman and ceo. “We achieved healthy sales growth in most regions, were able to improve gross margin despite higher product costs and achieved a significant increase in our operating margin.”

On a constant-exchange-rate basis, which excludes the effect of translating foreign-currency-denominated sales into U.S. dollars, the jewelry retailer says worldwide net sales and comparable store sales were up 16 percent and 15 percent.

By region, sales in the Americas, which includes the U.S., Canada and Latin America, grew 19 percent. Comparable Americas’ branch store sales increased 15 percent and sales in the New York flagship store rose 23 percent. Asia-Pacific sales grew 37 percent, while sales in Japan were up 7 percent. In Europe, sales increased 25 percent.

The company operates 232 stores, including 96 in the Americas, 55 in Japan, 52 in Asia-Pacific and 29 in Europe. Kowalski says the company plans to open 19 new stores and introduce a range of new products.

“Worldwide sales growth in the early part of this second quarter is continuing to exceed our expectation, with solid performance in most regions,” he adds. “Based on the better-than-expected first quarter results, we are increasing our earnings forecast for the year to $3.45 – $3.55 per diluted share (not including nonrecurring expenses) from $3.35 – $3.45 per diluted share previously.”