Tiffany & Co (TIF) has reported 4.51 percent rise in profit for the quarter ended Oct. 31, 2016. The company has earned $95.10 million, or $0.76 a share in the quarter, compared with $91 million, or $0.70 a share for the same period last year.      

Revenue during the quarter went up marginally by 1.18 percent to $949.30 million from $938.20 million in the previous year period. Gross margin for the quarter expanded 88 basis points over the previous year period to 61.04 percent. Total expenses were 83.65 percent of quarterly revenues, up from 83.33 percent for the same period last year. That has resulted in a contraction of 32 basis points in operating margin to 16.35 percent.

Operating income for the quarter was $155.20 million, compared with $156.40 million in the previous year period.

Frederic Cumenal, chief executive officer, said, “We are encouraged by some early signs of improvement in sales trends, but we clearly need more positive data over time before this can be considered an inflection point. In this recent quarter, we saw a smaller sales decline in the U.S from earlier this year, while Asia-Pacific results reflected strong growth in mainland China and a relatively smaller decline in Hong Kong. Our business in Japan performed well which we attribute to spending by domestic consumers, but we believe the strengthening of the yen has negatively impacted purchases by Chinese consumers. We also saw relative strength in UK sales, but a continuation of softness on the European continent.”

Working capital remains almost stable
Working capital of Tiffany & Co remained almost stable for the quarter at $2,873.50 million, when compared with the previous year period. Current ratio was at 5.52 as on Oct. 31, 2016, up from 5.06 on Oct. 31, 2015.

Days sales outstanding were almost stable at 19 days for the quarter, when compared with the last year period.

Days inventory outstanding has decreased to 286 days for the quarter compared with 579 days for the previous year period.

Debt moves up marginally
Tiffany & Co has witnessed an increase in total debt over the last one year. It stood at $1,105.20 million as on Oct. 31, 2016, up 3.22 percent or $34.50 million from $1,070.70 million on Oct. 31, 2015. Total debt was 21.51 percent of total assets as on Oct. 31, 2016, compared with 20.73 percent on Oct. 31, 2015. Debt to equity ratio was almost stable at 0.38 as on Oct. 31, 2016, when compared with the last year.

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