Breakfast At Tiffany´s in Moscow

In the Russian capital took place the opening of a new space of the legendary jewelry brand Tiffany & Co, specifically in the Petrovsky Passage, of the GUM department store, in front of the Kremlin.

Abel Amón. 08/09/2017

The new store has an area of ​​490 square meters and consists of two floors, which are accessed from the Petrovka street. In this new store visitors are plunged into the air of the first great brand of jewelry in New York. The boutique offers both the iconic jewels of modern collections such as Tiffany T, Tiffany HardWear or the premiere of this season of Fleur de Lis, among others.

In this new flagship, will take place an exhibition of products of the archive of the company whose history began in 1837. The exhibition will be present from 10 September to 10 November. A collection of exquisite jewelry from the late 19th century, elegant perfume containers, jewelers and miniature handbags can be seen. A separate part of the exhibition will be dedicated to various types of diamond cut, in which the Tiffany craftsmen rub the perfection.

The Petrovsky Passage, an emblematic place in Moscow, is owned by Bosco, a company that acquired notoriety in Spain being responsible for designing the clothing of the Spanish Olympic Team at the London Games 2008, but whose business range goes far beyond his well-known sportswear. This large department store has shops such as Alberta Ferretti, Bosco Fresh, Corneliani, Ermanno Scervino, Etro, Jil Sander, La Perla, Marina Rinaldi, Max Mara, Moschino and Paul Smith are on the ground floor. The second floor is occupied by the collections of Bosco (Donna, Uomo, Articolli By Bosco …) as well as by the café L’Altro Bosco Café.

Tiffany & Co needs to improve, especially its sales figure
The US company showed some semiannual results that include slight increases in net sales and operating margins, which contributed to a tinny increase in earnings per share. Net sales of US $ 1.9 billion were 2% higher than those of the previous year, while comparable sales (in the same stores) were 2% below the previous year, due to a good performance of wholesale sales of diamonds, especially in the Asian region, also improved online sales and high-end designer jewelry, although there was a considerable drop in sales of other jewelry. At constant exchange rates, world net sales rose 3% and comparable store sales decreased 1%. Net income increased 8% to $ 208 million, or $ 1.66 per share, to $ 193 million, or $ 1.53 per share in the same period a year ago.

Net sales by region were as follows
In the Americas, total sales decreased 1% to $ 830 million in the first half of 2017; comparable store sales decreased by 2%, respectively. The results varied widely from one region to another, but with good sales in the company’s flagship store in New York), and management attributed this slight drop in sales mainly to lower spending by foreign tourists. There is no appreciable effect due to exchange differences.

In the Asia-Pacific region, total sales were $ 492 million in the first half 5%, respectively, up from the previous year. Comparable sales growth in the same stores included strong growth in mainland China which was more than offset by falls in other countries that received less spending by foreign tourists. For example, in Japan, total sales for the semester were USD 268 million practically unchanged from the previous year.

Similarly, in Europe, sales of $ 208 million in the first half were the same as in the previous year, reflecting the increase in wholesale sales and the effect of new stores on the one hand, while sales in stores comparables declined by 2% Sales excluding exchange rate fluctuations increased by 4% in the first half.

Other highlights
Gross margin increased to 62.2% in the first half (61.6% in 2016). Selling expenses increased 2% in the first half, due to higher product prices, labor and indirect compensation costs and increased marketing expenses. Selling and administrative expenses as a percentage of net sales were 44.6% in the first half, unchanged from the previous year.

A positive finding was the decrease in net inventories of $ 2.2 billion as of July 31, 2017 were 4% lower than a year ago mainly due to the reduction in inventories of finished product. The company also improved in terms of cash and cash equivalents and short-term investments as of July 31, 2017, rising to $ 1.0 billion from $ 720 million a year ago and reducing total debt (short and long term) as a percentage of assets was 35% as of July 31, 2017, compared to 37% of the previous year.

Disclosure:The Luxonomist is not responsible for the views expressed in the article. The text has been written freely expressing their own ideas, without receiving any compensation. The author has no business relationship with any of the companies whose shares are listed in this article.

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