Tiffany & Co. posts drop in quarterly earnings

Tiffany & Co posted a 15 per cent fall in quarterly earnings due to a strong dollar and the cost of developing and bringing out new products, sending shares of the luxury jeweller to an 18-month low, says a report.

The company has also forecast a surprise 2-5 per cent decline in earnings for the year ending January, says a report. The company’s second-quarter profit fell to $104.9-million, largely due to a 9 per cent increase in selling, general and administrative expenses, which includes marketing.

A strong dollar has also dented the amount spent by tourists at Tiffany’s flagship Fifth Avenue store in Manhattan, besides reducing the value of the company’s overseas sales.

The company’s sales in the Americas fell 2 per cent in the quarter ended July 31. Total revenue fell 0.2 per cent to $990.5-million, while analysts had expected sales of $1.0-billion. Excluding currency effects, revenue rose 7 per cent.

The report further adds that though still a byword for luxury jewellery, Tiffany has been slow to innovate while the market has grown to offer customers a wide variety of high-end jewellery. The company is reportedly spending heavily on designing and marketing contemporary gold and silver jewelry to appeal to a younger, more style-conscious consumer. Among its newest products are the Tiffany T jewellery collection – described by the company as “unapologetically modern” – and Swiss-made CT60 watches. The company is also revamping some of its older lines, says a report.