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New stores boost Tiffany sales in Asia-Pacific

An expanding Asian store network has helped New York jeweller Tiffany & Co achieve strong sales increases in the first half of this year.

Tiffany sales in Asia-Pacific soared 28 per cent in the second quarter, to US$301 million (AU$413 million) and by the same rate in the first half, to US$629 million (AU$863 million).

The company says same-store sales rose by 13 per cent in the first half.

Management attributed the sales growth across greater China and most other Asian markets largely to higher spending by local customers and, to a lesser extent, spending by foreign tourists.

In Japan, net sales increased 11 per cent to US$155 million (AU$213 million) in the second quarter and 14 per cent to US$305 million (AU$418 million) in the first half, with comparable sales rising 9 per cent and 12 per cent, respectively, mainly due to locals increasing their spending.

CEO Alessandro Bogliolo said the company is still in the early stages of addressing its six key strategic priorities, and is pleased with initial customer reactions to its new communication, product and in-store initiatives.

“We are pleased with our sales and earnings growth and the strength and breadth of the results in the first half of this year, but it is worth noting that strategic investment spending is increasing for the remainder of the year, as expected, which is intended to support longer-term sustainable growth.”

Global results

Globally, higher earnings in both periods resulted from broad-based growth in worldwide sales, increases in gross margin and lower effective tax rates, partly offset by higher investment spending. Worldwide second-quarter net sales rose 12 per cent to US$1.1 billion (AU$1.5 billion), with comparable sales rising 8 per cent. Net earnings rose 26 per cent to US$145 million (AU$199 million).

Worldwide first-half net sales increased 13 per cent to US$2.1 billion (AU$2.9 billion), due to geographically broad-based growth and increases in all product categories; comparable sales increased 9 per cent. Net earnings increased 38 per cent to US$287 million (AU$394 million).

The company is about to embark on its recently announced multi-year remodeling of the New York City flagship building.

“We believe that the thoughtful combination of making short- and long-range strategic investments is necessary to achieve the full growth potential of this legendary brand,” said Bogliolo

Tiffany sales in Asia-Pacific were partly boosted by rebounding spending on jewellery and luxury goods by Chinese mainland visitors to Hong Kong.

This story originally appeared on sister site Inside Retail Asia.

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