NEW YORK – Tiffany & Co Inc. (TIF) Wednesday said quarterly profit rose a better-than-expected 53 percent as consumers snapped up more expensive jewelry in both U.S. and international stores.
The jewelry retailer, which raised prices on diamond and platinum jewelry at the end of the first quarter to combat rising costs, said a tax benefit also contributed to the earnings growth.
Tiffany boosted its profit forecast for the full year based on its strong second-quarter results. The company's stock rose 6.6 percent in before-the-bell trading on the Incents per share, a year earlier.
Wall Street analysts on average had forecast earnings of 24 cents per share, according to Reuters Estimates.
The profit included a contribution of $6.6 million, or 5 cents per share, from a tax benefit related to the American Jobs Creation Act of 2004 (search). Tiffany said its effective tax rate fell to 28 percent in the quarter from 38 percent a year earlier due to the benefit, which was expected.
Sales rose to $526.7 million from $476.6 million. Sales at the company's U.S. stores rose 8 percent, while international retail sales rose 12 percent.
The company raised its earnings per share forecast for the year to a range of $1.55 to $1.65, up from a previous estimate of $1.45 to $1.55.
Tiffany said its goal for 2005 sales growth is 8 percent to 10 percent.