Tiffany & Co
But being next to Trump Tower has hurt traffic at its flagship, it admits
Tiffany & Co. reported a 1 percent rise in worldwide net sales for the third quarter (ended Oct. 31), ending two years of sales declines.
The company also reported a 5 percent increase in net earnings to $95 million.
All in all, though, the company admitted results were “mixed,” with comps falling 2 percent (3 percent on a constant exchange basis). Fashion jewelry saw a modest increase, the company said, but that was offset by softness in other categories.
On a conference call following the release of the results, newly appointed chief financial officer Mark Erceg said that the security, media, and protests surrounding the Trump Tower had hurt foot traffic at Tiffany’s New York City flagship.
“Given the close proximity of our Fifth Avenue flagship store to the Trump Tower, we have noted that recent election-related activity has caused minor disruptions to pedestrian foot traffic around that store,” he said. “Federal, state, and local officials, and Tiffany security personnel, are all doing a fabulous job to minimize any disruption. Given the importance of the holiday selling season to our flagship store, we remain understandably cautious on how this situation may affect sales over the current weeks.”
Tiffany “cannot provide any assurance that sales in that store will not be negatively affected by this activity in the fourth quarter or in any future period,” added a statement.
Also in that statement, CEO Frederic Cumenal said he was “encouraged” by signs of an upturn but was waiting to see more positive data.
“In this recent quarter, we saw a smaller sales decline in the U.S. from earlier this year, while Asia-Pacific results reflected strong growth in mainland China and a relatively smaller decline in Hong Kong,” he said. “Our business in Japan performed well, which we attribute to spending by domestic consumers, but we believe the strengthening of the yen has negatively impacted purchases by Chinese consumers. We also saw relative strength in U.K. sales but a continuation of softness on the European continent.”
Despite the improvement, the company is not changing its guidance, which predicts sales for fiscal 2016 will fall in the low single digits.