Tiffany & Co. posted strong sales for the first quarter (ended April 30), with results so good even executives said they were surprised.
Worldwide comps rose 10 percent during the quarter, and overall sales jumped 15 percent to $1 billion. Profits soared 53 percent, to $142 million.
The company saw strong results across all its sales categories and all regions, said Mark Aaron, director of investor relations, during a conference call following the release of its financial results. While the company did not break out U.S. sales, it reported that comps in the Americas region increased 9 percent.
On the call, CEO Alessandro Bogliolo admitted its performance was “frankly, better than we expected,” prompting the company to raise sales guidance for the year.
As for the future, Bogliolo pledged the company will “step up its strategic spending now and for the rest of the year.” On tap are revamps to the company’s website and its stores, which the retailer hopes to make “more fun and engaging and more modern.” Bogliolo noted the company just opened a 17,000-square-foot Jewelry Design and Innovation Workshop in New York City, intended to “foster constant innovation and distinctive creativity,” part of a push toward continual newness.
He credited the company’s new Believe in Love marketing campaign for boosting the company’s sales of engagement jewelry, which rose 11 percent in the quarter.
“[The campaign] has a message of love in a more modern way that has really resonated with customers,” he said. “It really positions Tiffany as the experts in modern love, making us relevant for new generations.”
Bogliolo also repeatedly talked up the company’s new Paper Flowers collection, which he called “the big launch of this year,” but said it was too soon to report on sales.
He said the results show that the Tiffany brand is “very healthy” and well placed to adapt to changes in the luxury market.
“A characteristic of Tiffany is being very sophisticated yet inclusive,” he said. “At Tiffany, you find very refined product, starting from $300 all the way to several millions, but always with the same inclusive attitude and an informal kind of approach…[that] is perfectly set to respond to today’s customers.”
The company’s board also approved a $1 billion share repurchase program.
Top: Tiffany’s Fifth Avenue store in New York City (courtesy of Tiffany & Co.)