Tiffany’s lacklustre results brightened by Europe and Asia

By James Quinn, US Business Editor


Published: 10:23PM GMT 25 Nov 2009




The luxury retailer saw double-digit sales growth in both Europe and Asia in the three months to the end of October as consumers returned to take advantage of Tiffany’s wide range of jewellery.In Europe, including the UK, sales rose 12pc to $65m (£40m), thanks in part to the opening of its new boutique in Manchester. On a constant currency basis – stripping out conversion to the dollar - sales across its 25 European retail outlets were actually up 16pc. Across Asia, where Tiffany has almost of its shops, sales rose 10pc to $225.8m. But it was in the US – which accounts for more than 50pc of the jeweller’s sales – where customers stayed away, with sales falling 9pc to $303.5m, and like-for-like sales down by 10pc.Sales at its flagship Fifth Avenue store in New York fell by 8pc, and even its online and catalogue sales were off 9pc. Michael Kowalski, Tiffany’s chairman, noted: “We were pleased to see that the rate of sales declines in the US lessened as the quarter progressed.” “Global diversity is paying off for Tiffany,” said Matt Arnold, an analyst at Edward Jones. “It not only protects Tiffany, but it will yield a better growth profile as there are plenty more places it could still go.”Total sales fell 2.9pc to $598.2m with profits down 1pc to $43.3m. The company had 215 shops around the world at the end of October, compared to 204 at the same point a year ago, with plans to triple the number of shops it has in China over the next five years. Looking ahead, the company did say that November is off to a good start, and that it is hopeful for the key Christmas sales period, which starts in earnest in the US after Thanksgiving, November 26. In spite of being somewhat synonymous with high-end jewellery, Tiffany has an increasing range of products in different price ranges, with women’s jewellery available for as low as £80 and men’s square cuff links as low as £110. Not surprisingly, the retailer continues to see the greatest weakness in its high-end products – where prices can run into the tens of thousands of pounds – as a result of the destruction of wealth that has taken place during the recession. This content has passed through fivefilters.org.

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