NEW YORK Jewellery retailer Tiffany & Co. said Friday that its first-quarter profit plunged 62 per cent on a steeper-than-expected drop in sales as consumers continued to pull back on spending.
Still, the earnings matched Wall Street's expectations and the company maintained its profit outlook for the full year.
The New York-based retailer earned $24.3-million (U.S.), or 20 cents per share, for the three months ended April 30, down from $64.4-million, or 50 cents per share, a year ago.
Analysts polled by Thomson Reuters, whose estimates generally exclude one-time items, predicted net income of 20 cents per share.
“Despite reduced consumer demand in the luxury sector, Tiffany is, and is projected to remain, solidly profitable and will generate substantial cash from operations,” Chairman and Chief Executive Michael J. Kowalski said in a statement.
Sales fell 22 per cent to $523.1-million from $668.1-million a year ago and below analysts' expectations for revenue of $533-million.
Sales in the Americas slid 31 per cent, with U.S. same-store sales down 34 per cent. At its New York flagship stores, same-store sales were off 42 per cent.
Same-store sales, or sales at stores open at least a year, are a key indicator of retailer performance since they measure growth at stores open in both periods and exclude sales at newly opened ones.
Smaller sales declines were reported overseas, with Asia-Pacific sales down 9 per cent and European sales off 8 per cent.
Excluding the negative impact of the stronger dollar, worldwide sales slipped 18 per cent and same-store sales dropped 21 per cent.
Tiffany reaffirmed its guidance for full-year earnings from continuing operations of $1.50 to $1.60 per share. Analysts expect profit of $1.56 per share.