Tiffany & Co. said that market swings and general “uncertainties” likely hurt sales in the Americas and Europe for the two-month holiday period (ended Dec. 31).
“Local customers…may have been influenced more than expected by external events, uncertainties, and market volatilities,” said CEO Alessandro Bogliolo (pictured) in a statement.
Lower spending from foreign tourists may have played a role, he said, particularly tourists from China.
The retailer’s global sales declined 1 percent to $1.04 billion in the period, while comp sales fell 2 percent. On a constant currency basis, both overall sales and comps were equal to last year.
In the Americas, total net sales declined 1 percent to $514 million, and same-store sales were flat. The company attributes this to lower spending by both local customers and foreign tourists.
Tiffany’s strongest jewelry category this holiday was the collections category, which increased 2 percent. Engagement and designer jewelry fell 3 percent and 8 percent, respectively.
Bogliolo said that by increasing investment spending in certain areas, the company has “recovered lost ground from several years of soft sales trends,” he said. “We expect to report record levels of net sales and net earnings in fiscal 2018. Now the focus is to grow to new heights…. We believe that Tiffany is on a solid path for improved sales, margins, earnings, and cash-flow generation over the long-term.”
He promised that 2019 would bring “new product launches, an evolved marketing message, store expansions, and website enhancements.”
Still, the company did lower its overall outlook for fiscal 2018, predicting that sales would rise 6–7 percent for the year, rather than its previously forecast growth in the “high single digits.” He also said the company foresees that higher-than-expected expenses will hurt profits.
For fiscal 2019, the company forecast it would post sales growth in the “low single digits,” with net sales increasing in the “mid-single” digits.
(Image courtesy of Tiffany & Co.)