Luxury jewelry retailer Tiffany & Co. reported strong sales growth in the Americas and the Asia Pacific, lifting the company’s quarterly profit by 16%.
The better-than-expected results indicated that Tiffany (TIF) continues to perform well in an uneven macroeconomic environment that has especially stung the retailers that court middle- and lower-income shoppers. But higher-end retailers are generally performing better, and Tiffany on Wednesday said it still expects worldwide net sales to increase in the high-single-digits on a percentage basis this year. The company also slightly raised its earnings per-share target.
Tiffany reported higher net sales in almost all markets it serves. Sales leapt 14% in the Asia-Pacific region, climbed 9% in the Americas and 8% in Europe. The only decline was in Japan, where sales slid 13%.
“An improved gross margin was an important contributor to the earnings growth,” said Chief Executive Michael Kowalski, who recently announced he is planning to retire next year. He will be succeeded by President Frederic Cumenal.
A number of high-end retail names have reported sturdy results in North America and Europe, despite the muted gross domestic product performance in those regions. Michael Kors (KORS) recently reported stronger-than-expected sales in both those regions. Kate Spade (KATE) also reported strong sales growth earlier this month, although both of those companies have warned they’ll need to boost discounting to stay competitive.
Overall, Tiffany’s net sales increased 7% to $992.9 million for the quarter ended July 31, lifting per-share earnings to 96 cents from 83 cents a year ago. Analysts surveyed by Bloomberg had projected sales of $988 million and an 85-cent profit.