Two of America’s largest retailers reported their earnings from the Christmas holiday shopping season and the results are confusing, to say the least.
Tiffany & Co., said sales in the Americas region (mostly consists of the U.S.) for the November-December holiday period increased 3 percent to $516 million in the holiday period. On a constant-exchange-rate basis, total sales increased 2 percent, and same store sales declined 2 percent in the New York flagship store and in branch stores.
Worldwide net sales for the luxury jewellery retailer increased 4 percent to $992 million for the period, while same store sales were unchanged from the prior year
The results were on the “low-end of our expectations”, said Michael J. Kowalski, Tiffany chairman and CEO.Meanwhile, Zale Corp., which has stores in U.S., Canada and Puerto Rico, said same store sales increased 2.3 percent for the November and December holiday period. This falls short of the 5.9 percent rise in same store sales for the same period last year.
Revenues for the period increased a meagre 0.5 percent year-over-year to $567 million. The increase in revenues is primarily due to the same store sales growth partially offset by revenues associated with the closing of 50 stores.
Zales branded stores in the U.S., consisting of Zales Jewelers and Zales Outlet, posted an increase of 3.1 percent, compared to an increase of 10 percent in the same period last year. U.S. fine jewellery brands posted an increase of 2.2 percent. In the same period last year, U.S. fine jewellery brands same store sales rose 9 percent.
These numbers may seem disappointing on a year-over-year, basis, but officials at Zale Corp., which has been struggling since the 2008 economic collapse, appeared satisfied with the results.
“This holiday season, we focused on driving bottom line improvement”. said Theo Killion, Zale Corp. CEO. “Our comp performance … brings us closer to our goal of achieving positive net income for the fiscal year”.
The experiences of Tiffany and Zale differ from the experience of Signet Jewelers Ltd., the largest specialty retail jeweller in the U.S. and U.K. As I reported last week, its U.S. division saw a year-over-year sales increase of 9.9 percent to just over $1 billion with same store sales for the period up 4.7 percent led by its two largest retail brands, Kay and Jared. In addition, as reported last week, surveys of independent jewellers done by National Jeweler and the Centurion tradeshow reveal a positive sales growth for retailers in all regions of the country and for all markets.
This confusion in these results means that the U.S. economy is still in a fragile state, although growing gradually. It also means that some retailers have stood out by developing effective strategies during this difficult time.
There is some good news when it comes to the overall U.S. economy as investors are returning, according to recent reports.
Source:
http://www.jewellerynetasia.com/en/Blog/270/Mixed_Results_for_Christmas_Jewellery_Sales.html?user=6
