According to our fine friends at Reuters, Tiffany & Co. have lowered their fiscal-year sales and profit forecasts as recently as yesterday (Monday 27th August), citing global economic conditions and weakness in key markets for the jeweller such as Europe and New York. Yet the sparkle continues in the Asian region.
There seems to be a less than brilliant clarity for growth with Tiffany reducing its global net sales growth forecast by 1 percentage point to range of 6 percent to 7 percent for their financial year ending in January 2013. The Company lowered its full-year profit outlook to US$3.55 to US$3.70 a share from US$3.70 to US$3.80.
The slightly better news is that global sales rose 1.6 percent to US$886.6 million in the second quarter ended on July 31, whilst the not so good news is that retail sales at new company owned stores (open at least a year) fell 1 percent, excluding the impact of currency fluctuations. What does this mean for the future?
Tiffany reported net income of US$91.8 million, or 72 cents per share, for the quarter, compared with US$90 million, or 69 cents per share, a year earlier. Shares opened yesterday at US61 cents per share so it will be interesting to see how they perform over the coming days given that a one percentage point reduction at this end of the game is big business and even more so when you are a public company.
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