Retail shares soared on Monday, boosted in part by Tiffany & Co., whose fourth-quarter results brought some sparkle to the luxury sector.
The overall stock market also rose after J.P. Morgan Chase & Co. upped its takeover bid for Bear Stearns, and new housing data signaled a possible improvement in the sector.
The Dow Jones Industrial Average gained 1.5 percent to 12,548.64 and the broader S&P 500 also grew 1.5 percent, to 1,349.88. The S&P Retail Index swelled 3.6 percent to close at 409.82.
There were some notable gainers, particularly in the specialty sector. AnnTaylor Stores Corp. increased 7.5 percent to $24.70; New York & Company Inc. shot up 10.3 percent to $6.31, and Coldwater Creek Inc. rose 20.9 percent to close at $5.73.
Also among the top performers were Sears Holdings Corp., up 7.4 percent to $111.59; J. Crew Group Inc., a gain of 5.5 percent to $46.07, and Lululemon Athletica Inc., a rise of 12.6 percent to $31.13.
Shares of Tiffany & Co. jumped 10.5 percent to close at $42.65.
While the jewelry retailer posted a 15.8 percent decline in fourth-quarter earnings, hurt by onetime charges, its adjusted earnings beat analysts' expectations and, going forward, the company said it is poised for growth.
For the three months ended Jan. 31, earnings dropped to $118.3 million, or 89 cents a diluted share, from $140.5 million, or $1.07 in the year-ago period. Excluding onetime charges, profits reached $1.27 a diluted share, beating Wall Street's expectations of $1.21 a share.
Sales grew 9.8 percent to $1.05 billion from $958.9 million. U.S. retail sales rose 4 percent to $527.9 million, and same-store sales declined 1 percent. International retail sales increased 21 percent to $422.6 million, while comps grew 6 percent.
Onetime items, on a per-diluted-share basis, included a charge of 22 cents from loans to Tahera Diamond Corp. for protection from creditors in January; a charge of 7 cents due to lower-than-expected store performance at the company's Iridesse subsidiary, and a charge of 9 cents related to management's decision to discontinue select watch models in anticipation of the start-up of its strategic alliance with The Swatch Group Ltd.For the full-year period, earnings increased 19.6 percent to $303.8 million, or $2.40 a diluted share, from $253.9 million, or $1.91 last year. Sales increased 14.8 percent to $2.94 billion from $2.56 billion.
"In 2008 we expect to see robust growth in our non-U.S. markets other than Japan and are experiencing such performance in the quarter to date," said Michael Kowalski, chairman and chief executive officer. "We remain cautious about the U.S., although comparable-store sales are currently increasing slightly."
Tiffany expects a slight decline in domestic comps in the first half of the year and forecast full-year earnings in the range of $2.75 to $2.85 a diluted share. The company previously predicted fiscal 2009 earnings in the range of $2.50 to $2.55 a diluted share.
Also, during the first quarter, the company will discontinue valuing its inventories using the last-in-first-out inventory accounting method, which hurt profits, and will adopt the average cost method.
Mark Aaron, vice president for investor relations, said in an interview, "U.S. expectations continue to remain soft during the first half of the year, but we expect it to pick up in the second half. Foreign tourism has been increasing and is benefiting our U.S. operations, especially our New York flagship. A lot of Europeans are coming over with strong currency and shopping."
Aaron said the jewelry chain also sees "strong growth" in the rest of Asia and Europe, and in particular Hong Kong, Taiwan and Australia.
Tiffany has 17 stores in Europe, and it is entering the Madrid and Belgium markets.
"Our international business will be the driver of growth in 2008, except for Japan," Aaron said. "Our Japanese business has been soft for several years. It has been a tough environment over there. But we are making strides on improving how our business operates there by closing underperforming stores. But we are not banking on that market to improve any time soon."
“Azzedine has been one of the biggest influences in my life. He has always been such a strong, loving, fatherly figure to me. I call him Papa. His designs are indescribably unique, they are pieces of art. He knew how to make the female form look its loveliest. I have so many memories of him; my favorite might be during my first show with him in Paris. He liked me and he wanted to help me get more work. He called all his friends at Kenzo and Comme des Garcons, and asked them to book me. They said, ‘But she can’t walk!’ And he said, ‘but she has such a great ass!' His friendship and support has been the great privilege of my career. I can't imagine life without him. Repose en paix mon Papa.” - @stephanieseymour tells @wwd. #wwdfashion (📷: @steveeichner) #alaia #azzedinealaia
Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia
Azzedine Alaïa's “I-did-it-my-way” ethos stood out starkly at a time when brands are experimenting with consumer-facing fashion shows, coed formats and trans-seasonal collections – anything to perk up lackluster sales of ready-to-wear in an age of Insta-everything. “It’s not creation anymore. This becomes a purely industrial approach,” the late designer told WWD in an interview last year. “But anyway, the rhythm of collections is so stupid. It’s unsustainable. There are too many collections.” Read more about the iconic designer’s life and work on wwd.com, link in bio. #wwdfashion #azzedinealaia (📷: @WWD Archive, 1986) #alaia
Sneaker reselling app @goat’s latest exhibit, "The Greatest: New York," tells the story of New York's sneaker culture. To celebrate the exhibit, an intimate crowd gathered on Thursday night at the pop-up gallery space, located at Platform in Culver City, to hear guest speaker and illustrator @esymai talk about her own rise in streetwear and women in the business. "For me I'm just someone who is creative. I like to create things," said Chang. #wwdfashion
Azzedine Alaïa, one of the most iconic couturiers of the modern era whose body-con designs defined Eighties fashion, has died in Paris. The diminutive Tunisian-born designer, known for his structured knitted dresses with fitted waists and impeccably cut, figure-hugging second skin silhouettes was deeply admired by his peers, and counted supermodel Naomi Campbell - his adoptive daughter - among his inner circle, one of a gang of glamazons including Farida Khelfa, Carla Bruni and Stephanie Seymour who became ambassadors of his style. (📷: Alexandre Guirkinger) #wwdblast