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Tiffany posts rise in profit for first quarter

Tiffany & Co., a retailer of fine jewelry, crystal and china, said Friday that first-quarter earnings rose 9 percent from last year, as strong sales in the United States helped offset weakness in Japan.

Tiffany & Co., a retailer of fine jewelry, crystal and china, said Friday that first-quarter earnings rose 9 percent from last year, as strong sales in the United States helped offset weakness in Japan.

Net income increased to $40.1 million, or 27 cents per share, for the three months ended April 30 from $36.8 million, or 25 cents per share, a year ago.

Sales grew 12 percent to $509.9 million from $457 million last year. Excluding the translation effect from a weaker U.S. dollar, net sales rose 11 percent and worldwide same-store sales were up 4 percent.

Analysts surveyed by Thomson Financial were looking for profit of 24 cents per share on sales of $493.7 million in the latest quarter.

Michael J. Kowalski, chairman and chief executive officer, said, “We are very pleased with the robust growth in our U.S. sales, which compared with a very strong quarter last year, as well as growth in many international markets. Sales in Japan remained below our expectations, but we will continue to focus our managerial, marketing and merchandising resources on that market.”

Gross margin declined to 53.9 percent in the first quarter from 56.7 percent in the prior year, largely due to changes in geographic and product sales mix, as well as higher product costs.

Tiffany is targeting full-year sales growth of 8 percent to 10 percent, including annual same-store sales growth in a mid-to-high single-digit range in the U.S. and in a low-single-digit range in yen in Japan.

The company maintained its expectation for 2005 profit of $1.45 to $1.55 per share, however, Tiffany stated that earnings could be at the lower end of that range if full-year same-store sales in Japan were to drop by a single-digit percentage.

Analysts are forecasting full-year profit of $1.51 per share, on average.