NEW YORK — The holidays sparkled this year for Tiffany & Co., with better-than-expected sales prompting the jeweler on Tuesday to raise its full-year earnings forecast.
The improvement is a sign that affluent shoppers are returning to luxury purchases as the stock market bounces back and
the rich in booming Asian economies are ramping up spending.
Tiffany CEO Michael Kowalski said in a statement Tuesday that the company saw strong sales of its higher-end fine jewelry collections, diamond engagement rings and fashion gold jewelry during the two-month holiday period.
Revenue from lower-priced silver jewelry, which was strong during the recession as shoppers looked to curb spending, were limited, Kowalski said.
The New York company, known for its little blue boxes, now expects full-year earnings between $2.83 and $2.88 per share, up from a prior forecast of $2.72 to $2.77 per share.
Analysts surveyed by FactSet predict earnings of $2.77 per share.
Investors had even higher hopes and sent Tiffany’s shares down 44 cents to $60.50.
Tiffany anticipates revenue for the fiscal year ending Jan. 31 to come in at nearly $3.1 billion, which would best Wall Street’s $3.05 billion.
Worldwide sales for November and December climbed 11 percent to $888.5 million. The company said revenue grew the most in the Asia-Pacific region, up 23 percent to $138.9 million, while sales in Japan rose 11 percent to $142.5 million. Revenue climbed 13 percent to $114.9 million in Europe and 9 percent to $484.8 million in the Americas.
Revenue at stores open at least a year increased 8 percent adjusted for changing exchange rates. This figure is a key indicator of a retailer’s health because it gauges results at existing stores instead of newly opened ones.
“Tiffany capped off a strong 2010 with a solid holiday season,” said Wall Street Strategies analyst Brian S. Sozzi.
He kept his “Hold” rating on the stock, however, and said Tiffany still has to deal with European debt issues, a tax increase in the U.K. and higher costs for gold and other precious materials.
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