Tiffany & Co. reported that its global net sales for FY 2017 (ended January 31, 2018) increased 4% to $4.2 billion, reflecting sales growth in most regions - particularly in the U.S. and China. However, its comparable store sales remained flat for the year despite 9% sales growth in the fourth quarter (Q4). During Q4, on a constant-exchange-rate basis, worldwide net sales rose 6% and comparable store sales were 1% above the prior year, falling short of estimates of a 2.7% gain. Profits for the year totalled $370 million, which were 17% below the prior year's $446 million, and $62 million in Q4, which is 61% below the prior year’s $158 million, due to charges related to tax changes in the US. CEO Alessandro Bogliolo, said, “We are pleased to be finishing the year with solid sales growth ... Most important, however, is to generate sustainable growth in sales, margins and earnings over the long-term." He added, “We will only be truly satisfied when we create greater excitement for our customers and also generate growth that reflects the full potential of our brand.
Speaking to the latter intention, Bogliolo said during a conference call following the release of its financial results - according to reporting by Rob Bates of JCK - that the company had undergone a strategic review and wanted to refresh its communications and merchandise as well as focus on omnichannel. He also said he wanted to “dramatically improve and enhance” the company’s physical stores, calling it a “key area of investment” for the brand. “The key for me", he said, again according to Bates, "is to inject some freshness, some newness, some excitement in the store[s]. Nowadays consumers are more demanding. It’s not enough to have a beautiful store. If you have a beautiful store, and I’ve been to it three or four times, why should I come to the store when I can buy the same product from Tiffany.com? … [We are looking for] visual merchandising and in-store presentations as a way to animate the point of sale.” Speaking to ways to reach millennials, he said, “Tiffany has always been, compared to other [luxury] brands, more inclusive, more open to innovation, less formal, and more about a joyful experience.”
Sales across the various regions were as follows: In the Americas, total net sales rose 2% to $1.9 billion in the full year and 5% to $619 million in the fourth quarter; comparable store sales increased 1% and 5% in the respective periods. In Asia-Pacific, total net sales increased 10% to $1.1 billion in the full year and 13% to $320 million in the fourth quarter; comparable store sales declined 1% and rose 3% in those respective periods - the full year decline, they said, reflected strong sales growth in mainland China, which was offset by lower sales in most other countries, while the fourth quarter sales growth benefited from performance across Greater China. In Japan, total net sales of $596 million in the full year were 1% below the prior year, while sales in the fourth quarter rose 2% to $189 million; comparable store sales declined 1% and rose 1%, respectively.
In Europe, total net sales rose 6% in the full year to $483 million and 13% to $165 million in the fourth quarter, reflecting the positive effects from currency translation, new stores and e-commerce sales growth; comparable store sales declined 2% and rose 1% in the respective periods, which management attributes in part to softness across much of the region as well as negative effects from new stores on existing store sales.