Luxury jewelry retailer Tiffany & Co (NYSE: TIF) posted its fourth-quarter 2018 earnings before the opening bell on Friday, March 22. Dismal holiday results pushed net sales down 1% to $1.32 billion. Comparable sales also dipped 1% in the period.
However, helped by lower tax rate, net earnings in the quarter jumped to $205 million or $1.67 compared per diluted share, from the year-ago profit of $62 million or $0.50 a share.
The Street estimated a 3.6% slump in earnings to $1.61 per share, on revenue estimated at about $1.34 billion.
For fiscal 2019, Tiffany & Co expects worldwide net sales to rise by a low-single-digit percentage over the prior year, while net earnings per diluted share to increase by a mid-single-digit percentage.
In the first half of the year, net earnings is expected to slip on lower foreign tourist spending due to the strengthening US dollar, along with expenses related to higher strategic investment spending that began in 2018 second quarter.
The company also expects a low-single-digit rise in full-year comparable sales, with eight store openings, six closings and 15 relocations.
NOT SO JOLLY HOLIDAY
Back in January, the luxury giant was forced to cut its yearly profit forecast on weaker holiday sales, which the company attributed to lower spending by Chinese tourists on a global level. Tiffany also saw declining Europe demand.
During the last two months of 2018, worldwide same-store sales dipped 2% while net sales fell 1% — in contrast with the estimation was that they would increase modestly.
Tiffany Chief Executive Alessandro Bogliolo in a statement said that lower spending by tourists, mostly Chinese, and uncertainties in Europe have adversely affected customer demand.
Alessandro Bogliolo’s statement read, “overall holiday sales results came in short of our expectations.”