Cameron Russell for Tiffany & Co.

Tiffany & Co. is spending to grow, but its comparable sales still need work.

The jeweler’s fourth-quarter net profits fell to $61.9 million, or 50 cents a diluted share, from $157.8 million, or $1.26, a year earlier. But excluding tax charges in the most recent quarter and impairment charges a year ago, Tiffany said profits rose 15 percent to $208 million, or $1.67 a diluted share.

Sales for the three months ended Jan. 31 rose 8.5 percent to $1.33 billion from $1.23 billion. But comparable sales rose just 1 percent, below the 2.7 percent gain analysts were reportedly projecting.

Investors appeared to be looking for more from comp sales and sent shares down 4.6 percent to $98 million in premarket trading.

Alessandro Bogliolo, chief executive officer, said the company ended the year with “solid sales growth” and stressed the importance of being able to “generate sustainable growth in sales, margins and earnings over the long-term.”

“Confirming what we recently indicated, we believe that increasing investment now in certain areas, such as technology, marketing communications, visual merchandising, digital and store presentations, which we expect will hinder pre-tax earnings growth in the near-term, is needed to generate that lasting long-term growth,” Bogliolo said.

Bogliolo joined the company late last year and declared it would “not be acceptable” to see competitors outpace the company’s sales growth.

“We acknowledge that some of our competitors have recently posted stronger sales growth than us, which I can assure you will not be acceptable in the long-term,” he told Wall Street in November.

For the full year, net earnings slipped 17 percent to $370.1 million, or $2.96 a diluted share, from $446. 1 million, or $3.55, a year earlier. Sales increased 4.2 percent to $4.17 billion from $4 billion on flat comps.

This year, the company is looking for net earnings to increase to a range of $4.25 to $4.45 as comp sales grow in the low-to-midsingle digits.

More from WWD:

Trevor Edwards Out as Nike Brand President

L’Oréal Acquires ModiFace

EXCLUSIVE: Nina Ricci Names Charlotte Tasset as General Manager

load comments
blog comments powered by Disqus