Tiffany Profit Tops Analysts’ Estimates on Asian Demand

May 28 (Bloomberg) -- Bloomberg’s Dominic Chu reports on Tiffany & Co. earnings. He speaks on Bloomberg Television's "In The Loop." (Source: Bloomberg)

Tiffany & Co (TIF)., the world’s second-largest luxury jewelry retailer, reported first-quarter profit that topped analysts’ estimates, led by demand in Asia. The shares jumped the most in almost seven months.

Net income in the quarter ended April 30 rose 2.5 percent to $83.6 million, or 65 cents a share, from $81.5 million, or 64 cents, a year earlier, the New York-based company said today in a statement. Excluding expenses related to cost-saving initiatives, profit totaled 70 cents a share. On that basis, analysts projected 53 cents, the average of 19 estimates compiled by Bloomberg.

Tiffany is benefiting from global growth in luxury-goods spending that Bain & Co. estimates will be sustained this year as demand in Southeast Asia helps counter slowing purchases in Europe. Sales in Tiffany’s Asia-Pacific region advanced 15 percent to $223 million in the quarter.

Tiffany climbed 4 percent to $79.22 at the close in New York, for the biggest gain since Nov. 1, 2012. The shares gained 38 percent this year, compared with a 16 percent increase for the Standard & Poor’s 500 Index.

Total revenue increased 9.3 percent to $895.5 million. Analysts estimated $854.6 million, on average.

Forecast Maintained

In the Americas, sales rose 6 percent to $408 million. Sales at stores open longer than 12 months gained 3 percent, with the Fifth Avenue location’s sales growing faster than that rate, Tiffany said. A 175th anniversary “Blue Book” event selling high-priced jewelry helped sales, the company said. David Schick, an analyst with Stifel Financial Corp., estimated comparable-store sales would gain 2 percent.

Photographer: Konrad Fiedler/Bloomberg

Tiffany & Co. is benefiting from global growth in luxury-goods spending that Bain & Co. estimates will be sustained this year as demand in Southeast Asia helps counter slowing purchases in Europe. Close

Tiffany & Co. is benefiting from global growth in luxury-goods spending that Bain & Co.... Read More

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Photographer: Konrad Fiedler/Bloomberg

Tiffany & Co. is benefiting from global growth in luxury-goods spending that Bain & Co. estimates will be sustained this year as demand in Southeast Asia helps counter slowing purchases in Europe.

Schick, who’s based in Baltimore, recommends holding the shares.

The company today reiterated its forecast that profit per share excluding some items would be $3.43 to $3.53 in the year ending Jan. 31. Analysts estimated $3.49, on average.

Tiffany said sales would grow at a “mid-single” digit percentage rate in U.S. dollars after earlier forecasting growth of 6 percent to 8 percent.

Cie. Financiere Richemont SA is the world’s largest luxury jewelry maker.

To contact the reporter on this story: Cotten Timberlake in Washington at ctimberlake@bloomberg.net

To contact the editor responsible for this story: Robin Ajello at rajello@bloomberg.net

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