Tiffany & Co. jewelry is displayed in a store in Paris, France, November 25, 2019. REUTERS/Gonzalo Fuentes
(Reuters) – Luxury jeweler Tiffany & Co (TIF.N), which is being bought by Louis Vuitton owner LVMH (LVMH.PA), missed Wall Street expectations for quarterly profit and sales on Thursday as weak demand at home and in Hong Kong offset growth elsewhere in China.
Tiffany’s business in the Americas has suffered in recent years as price-conscious younger customers gravitate to lower-priced competitors including Denmark’s Pandora A/S (PNDORA.CO) and Signet Jewelers (SIG.N).
Net sales in the Americas fell 4% in the third quarter, mainly dented by lower spending by foreign tourists, while sales in the Asia-Pacific region were flat, hurt by business disruptions in Hong Kong, where sales fell 49%.
Despite double-digit growth in Mainland China, overall same-store sales, excluding the effects of currency exchange rates, were up 1% in the quarter, missing analysts’ average estimate of a 1.44% increase, according to IBES data from Refinitiv.
Late last month, French luxury goods maker LVMH agreed to buy Tiffany for $16.2 billion, a deal that could help boost the U.S. jeweler’s business, which has struggled with dated collections and a retreat from Chinese shoppers in America.
“We are very excited about the recently announced transaction with LVMH and, pending the required approvals, look forward to becoming part of the LVMH family of exceptional luxury brands,” Tiffany Chief executive Officer Alessandro Bogliolo said.
Tiffany’s net earnings fell to $78.4 million, or 65 cents per share, in the quarter ended Oct. 31, from $94.9 million, or 77 cents per share, a year earlier.
Wall Street had expected the company to earn 85 cents per share.
Net sales were largely flat at $1.01 billion, while the average analyst estimate was $1.03 billion.
Reporting by Aishwarya Venugopal in Bengaluru; Editing by Maju Samuel