Tiffany Sees Modest Growth Ahead After Tougher Holiday Quarter

(Bloomberg) -- Tiffany & Co.’s challenging holiday season persisted into the rest of the fourth quarter, but it’s forecasting slight growth for the year ahead as things get better from here.

• Same-store sales -- a key gauge of retail success -- were flat on a constant currency basis, just shy of analysts’ average estimate for a 0.1 percent gain.

Key Insights

• The jeweler had already warned its Christmas-period performance came short of the luxury jeweler’s own expectations, so the mixed news on Friday shouldn’t have come as too much of a surprise.
• Executives have said a shortfall in international tourism spending was partially to blame. These tourists, mainly from mainland China, have long propped up luxury shopping, and their slowdown in purchases have prompted concerns that a reliable customer base is faltering. Chief Alessandro Bogliolo reiterated that “softer trends in the second half of the year reflected, in part, what we believe were external challenges and uncertainties.”
• Fortunately for shareholders, it gets better from here. The company -- which its CEO says is “still in early stages of a journey to achieve long-term sales, margin and earnings growth” -- sees single-digit growth in earnings per share and sales ahead this year.

Market Reaction

• Tiffany shares fell 2.8 percent in New York, the biggest drop in almost two months. The shares had gained 24 percent so far in 2019 through Thursday’s close, outpacing the S&P 500’s rise.

Get More

• For more on Tiffany’s results, click here.
• For Tiffany’s statement, click here.

To contact the reporter on this story: Kim Bhasin in New York at kbhasin4@bloomberg.net

To contact the editors responsible for this story: Anne Riley Moffat at ariley17@bloomberg.net, Jonathan Roeder, John Lauerman

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