Tiffany & Co European sales jumped by 21% on a constant exchange rate basis in Q1 2015, with comparable store sales rising by 17% due to strong interest from tourists and local customers alike.
In US dollar terms, total sales in Europe rose 2% to $103m (£67.2m) in the three months ended April 30 2015.
Across the company as a whole, net sales of $962m (£627.9m) were 5% below the prior year. However, on a constant exchange rate basis excluding the impact of translating foreign currency into the US dollar, worldwide net sales rose by 1% due to growth in all regions except Japan.
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This has largely been accredited to increased sales of fashion gold jewellery and statement jewellery.
Net earnings declined by 17% to $105m (£68.5m) or $0.81 per diluted share, compared with $126m (£82.2m) or $0.97 per diluted share a year ago.
Frederic Cumenal, chief executive officer, said, “We started the year facing well-known challenges from both global economic uncertainties and the effect of a strong U.S. dollar on the translation of foreign-denominated sales into dollars and on foreign tourist spending in the U.S., as well as a difficult sales comparison in Japan. Despite those factors, our first quarter results for net sales, as well as for gross margin and net earnings, were somewhat better than we anticipated.
“First quarter highlights also included the continuing success of the stylish Tiffany Outlet T jewellery collection, as well as the launch of our extraordinary CT60 watch collection.”
The brand’s weakest market was Japan, where total sales declined 18% and comparable store sales declined by 24%. This is balanced somewhat by strong growth in Q1 2014, where store sales surged by 30%.
Tiffany opened three company-operated stores in Q1, two in China and one in Miami, USA. As of April 2015, the company operates 298 stores, including 38 in Europe – an increase of six.
Cumenal added: “Our plans this year include expanding existing Tiffany jewellery collections with new designs and opening stores in a number of important markets, all intended to further enhance Tiffany’s position as a leading global luxury brand.”
Looking ahead to the fiscal year ending January 31 2016, management continues to forecast minimal growth in net earnings.