Tiffany's Beats Estimates
By Matt Paolucci
High-end jewelry retailer Tiffany & Co. (TIF) said that a 26
percent growth in worldwide sales in its first quarter,
combined with improved margins, resulted in net earnings
growth of 88 percent.
The New York-based Company reported first quarter net income
of $30.4 million, or 40 cents per diluted share, compared with
$16.1 million, or 22 cents per diluted share, in the prior
year period. Net earnings per share in 1999 are adjusted to
reflect a two-for-one stock split in July 1999.
First Call estimates were for profits of 37 cents per share.
For the first quarter, ending April 30, net sales were $343.2
million, a 26 percent improvement from $272.2 million in the
prior year.
The sales performance was highlighted by U.S. comparable store
sales growth of 28 percent, as well as strong increases in
international markets.
U.S. retail sales rose 28 percent to $169.1 million. The
addition of four new stores helped in generating the strong
results. But those gains were offset by the Company's
discontinuation of its U.S. wholesale trade business in
January 2000.
International Retail sales increased 26 percent to $147.4
million. Comparable store sales growth was strong in all key
regions, highlighted by a 15 percent increase in local
currency in Japan, Tiffany's largest international market.
Direct Marketing sales rose 15 percent to $26.6 million
primarily due to growth in corporate and catalog sales, along
with results from Tiffany's e-commerce initiative that
commenced in November 1999.
Wall Street is also a big advocate of the high-margin
retailer. Of the twenty-three analysts who cover shares of
TIF, twenty rate the stock either a Strong Buy or Moderate
Buy.
The earnings outlook for TIF also looks bright. The Company
earned $1.95 for fiscal 2000. Estimates for fiscal 2001 and
2002 are for $2.37 (a 21.5 percent increase year-over-year)
and $2.80 (an 18.1 percent increase year-over-year),
respectively.
Yesterday, Chase Hambrecht & Quist upgraded Tiffany and Co. to
a Strong Buy from Buy.
