Jewels of the new century
The millennium is providing an unprecedented opportunity for brands to launch new, ever more lavish products. Dozens of diamond jewellery producers are using the 2000 milestone to come up with extravagant collections, many of which were launched at the Basel 1999 watch fair in Switzerland recently.
Lines from Van Cleef & Arpels, Alfieri & St John, Concord, Chopard and Omega representing the start of the next century will be available from the end of this year. According to the Diamond Information Centre, 2000 will see 28 million engagements, 40 million marriages, 69 million births and 880 million anniversaries – which means plenty of opportunities for diamond producers to sell expensive baubles.
Central Links
It is not just the big retailers expanding in Central. So are smaller stores, like accessories maker links of london jewellery, which is opening its enlarged shop in Prince’s Building on June 3. The company’s award-winning managing director and designer, Annoushka Ducas, will fly in from London for the opening.
Links of London Charm has 14 independent stores in London, Dubai, Melbourne and Hong Kong.
Healthy heads
A haircare line newly available in Hong Kong is proving popular among aficionados of natural products. Green Light, from Italy, uses two principal natural ingredients (a vegetable extract and an innovative active substance) for a line that is completely non-toxic. Products include a shampoo enriched Links of London Necklace with wheat protein and glycolic camomile extract, scalp treatments enriched with essential oils and sprays loaded with vitamins.
Green Light is available from Seibu, and prices run from $ 100 for the shampoo to $ 400 for a product containing linen seeds.
Tiffany Opens Boutique in Seoul, Korea
Tiffany & Co. (NYSE: TIF) today opened a store in Seoul, Korea. The approximately 1,100 gross-square-foot boutique is located in the Shinsegae department store at 52-5 Chungmooro 1-ga, Jung-gu. With this new boutique, TIFFANY & CO. products are available in 11 authorized retail locations in Korea.
“As Seoul’s first department store built in 1930, Shinsegae is an architectural treasure that, along with other buildings in the area, has been designated a historic landmark by the City of Seoul,” said Michelle Kim, managing director, Tiffany & Co. Korea. “We are honored to be part of the store’s re-opening excitement after a two-year renovation, and further honored to have a presence in this setting of culture and tradition, with its elegant square and beautiful fountain. The design of the TIFFANY & CO. boutique respects this great heritage that provides us with a unique and gracious environment to present our own heritage of quality and craftsmanship for which we are known throughout the world.”
The boutique combines architectural details of Tiffany’s famous New York flagship store, including Makore wood and stainless steel framed showcases and vitrines. Among the array of TIFFANY & CO. collections offered are the jeweler’s celebrated diamonds in platinum and eighteen-karat gold settings; exclusive designer collections of Elsa Peretti, Paloma Picasso, Jean Schlumberger, and world-renowned architect Frank Gehry, Tiffany bracelets newest designer; fine and engagement Tiffany jewelry; watches; sterling silver jewelry; and a selection of accessories and gifts.
Tiffany & Co. operates jewelry and specialty retail stores and manufactures products through its subsidiary corporations. Its principal subsidiary is Tiffany and Company. The Company operates TIFFANY & CO. retail stores and boutiques in the Americas, Asia-Pacific and Europe and engages in direct selling through Internet, catalog and business gift operations. Other operations include consolidated results from ventures operated under trademarks or trade names other than TIFFANY & CO. Additional information can be found on Tiffany’s web site, www.tiffany.com.
Tiffany cuff links & CO. and TIFFANY are exclusive trademarks of Tiffany and Company.
Tony Tiffany aims to portray itself as jeweler to the masses
As it prepares to formally open a new store at the Atrium Mall in Newton Nov. 15, Tiffany & Co. wants everyone to know its famous Tiffany jewelry is as much for hoi polloi as for the carriage trade.
“Tiffany has been a well-kept secret,” asserts Michael J. Kowalski, the company’s president and chief operating officer. “We’ve been trying to aggressively communicate the message that Tiffany is more affordable than you think.”
On first hearing, that seems a bit of a stretch.
For example, Tiffany’s 1997 holiday catalog features diamond crab-shaped earrings for $ 6,900 – a gewgaw perhaps for the late Audrey Hepburn, star of “Breakfast at Tiffany’s,” but hardly a trinket that often turns up in the jewel box of a soccer mom.
Aside from fine diamonds, the Tiffany bracelets catalog also includes $ 17 crystal beer mugs, and an assortment of cigar tools, and golf gear, such as a $ 50 silver golf tee.
A luxury retailer can lose the cachet of exclusivity when it widens its customer base. So far, though, Tiffany – with its signature powder blue box – has kept its tony image even as it dabbles in TV advertising.
Management has “exhibited excellent execution” of its goal to “concurrently attract new customers, particularly young shoppers, without disturbing its carriage trade clientele,” Rodman & Renshaw analyst Harry A. Ikenson wrote in August.
As Tiffany broadens its market and opens new stores, annual sales have grown 12 to 15 percent for much of the decade.
In 1993, the company reported profits of $ 15.7 million on sales of $ 486.4 million. For its latest fiscal year, Tiffany had profits of $ 58.4 million on sales of $ 922.1 million.
About 57 percent of last year’s sales came from the United States, about 27 percent from Japan. By the end of the year, Tiffany said it will operate 27 stores in the United States and 92 additional retail locations overseas.
Sales at older US stores, a measure of performance that Wall Street watches closely, were up 11 percent, 12 percent, and 12 percent for the past three years, respectively, and up 8 percent for the first half of this year, Tiffany said.
The store at the Atrium Mall will be Tiffany’s second in Greater Boston and one of four US stores it will open in 1997. Tiffany also operates a store at Copley Place.
Because there are many cities not currently served by a Tiffany store, the company believes that as a well-known player in the $ 25 billion US fine Tiffany pendants market, it has substantial room for growth by opening stores in new markets.
It’s conventional wisdom that luxury retailers thrive when the stock market booms, but Kowalski says there are factors other than a bull market behind Tiffany’s success. “One of our best holiday seasons was in 1987 just after the market crashed,” he said.
A big reason for the company’s growth, Kowalski said, is consumers’ love affair with quality brand names over the last few years. “The general move toward value is very much to Tiffany’s benefit.”
Shares of Tiffany stock, which traded above 48 in June on the New York Stock Exchange, have since settled to about 40 on fears that New York-based Tiffany does too much of its business in some volatile Asian markets. Shares yesterday were up 7/16 to close at 41 1/16.
On Monday, Ikenson reiterated his buy rating on Tiffany necklaces.
“In our opinion, the recent share-price weakness reflects investor concern over Tiffany’s exposure to Hong Kong,” the analyst wrote. “However, Hong Kong represents only 2 percent of Tiffany’s business. Therefore, we believe this represents a buying opportunity.”
Ikenson said he anticipates a “solid third quarter” when Tiffany reports its earnings later this month.
Distinctive and quirky jewels for every pocket
Astley Clarke has gems at every price, says ANNE ASHWORTH
The rise of Astley Clarke, the online links of london jewellery store, is proof that, despite the insatiable appetite for bargain buys, there is still a willingness to be wooed by yet another new luxury brand, especially if its website provides an interlude of entertainment and glamour in the working day.
About 100,000 customers a month are now viewing Astley Clarke’s contemporary designs whose prices start at about £ 50. This may not quite compare with the one million customers of Tesco.com, where Bec Astley Clarke, the chief executive, served some of her online retailing apprenticeship. But then this is a jewellery business more akin to Asprey than H Samuel; some items cost as much as £ 4,500. A delicate necklace set with small, coloured stones from the designer Pippa Small is £ 2,500. But Miss Small is also an anthropologist, which makes this an adornment with intellectual credibility.
A certain quirkiness characterises many of the baubles. But they are always pretty, never outlandish. Traditional strings of pearls are transformed into the striking with the addition of a chunky crystal drop (£ 175), or a ruby wrapped in 24ct gold (£ 950).
This mixture of relatively cheap items and more expensive treats gives Astley Clarke something in common with that other ever-more popular British brand Smythson. The price tag on the Smythson Nancy bag may be £ 950, but the matching keyring costs £ 60. The two businesses share a backer -Venrex, the venture capital group. Miss Astley Clarke’s other sources of finance include Local Globe, owner of Agent Provocateur, yet another irrepressible Brit brand.
The British are expected to spend a record £ 13.9 billion online this Christmas of which Astley Clarke aims to have its slice. However, just to make sure, the company is resorting to some oldtechnology marketing ploys. Last month it opened an appointment-only showroom in London and produced a catalogue. This is not, as you might assume, a glossy affair, but a disappointlingly dull and saccharine document in which Links of London Necklace pose alongside Laduree macaroons. These may be indulgences but not as attractive as the Astley Clarke silver and turquoise ring (£ 750), the Vinnie Day gold vermeil interlinked bangles with charms (£ 200) or the amethyst and gold earrings (£ 100) from the same designer.
These emerged as my favourites when my colleagues and I took a screen break this week at Astley Clarke, shopping not for Christmas but for a bridal gift for one of our number. The sapphire-set chandelier earrings (£ 1,050) were at the top of several other personal wish-lists. Our final selection, not for ourselves, but for our co-worker, came from the £ 50-£ 100 category. I would tell you more, but I am sworn to secrecy. We hope she enjoys wearing it. Choosing it was certainly fun for us.
The Links of London Earrings in the chain.
Links of London Chmn, CNNfn
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
SUSAN LISOVICZ, CNNfn ANCHOR, BUSINESS UNUSUAL: You could say Ayton is a worldly man. Back in the ’80s, when John Aton met his future wife at an ex-patriots ball in Hong Kong, he was a frustrated young law clerk. Today, nearly two decades (20:21:10) later, he and his wife sit atop a global high-end jewelry brand based in the UK. So how did Ayton get from A to B? Well, it all started with a pair of (20:21:20) silver salmon cufflinks. Joining me now to explain, John Ayton, chairman and co-founder of links of london jewellery. Welcome.
JOHN AYTON, CHAIRMAN, LINKS OF LONDON: Good evening.
LISOVICZ: We hear a lot of great stories about people who have a brilliant idea for a new (20:21:30) business. But you were in what my British friends would describe, you were fishmongers in London. You ran a fish store. You supplied fish to restaurants and it all started with a holiday present (20:21:40) that your wife designed.
AYTON: We, every Christmas, we had to give the chefs a present and Anushka (ph) my wife, had the idea of designing a fish pair of cuff links because (20:21:50) most of the chefs were men at that point in time. And it was a great success.
LISOVICZ: And they loved it and then she sold out the rest, right?
AYTON: She sold out the (20:22:00) rest. She took them to a London store and they said, we love these, but you’ve got to do a collection and they were a great hit.
LISOVICZ: And so what ever happened to (20:22:10) the fish store, I’m curious.
AYTON: . to the what?
LISOVICZ: . to the fish store. Did you just abandon that business?
AYTON: Well, it was a fish business. We eventually, Links became such a success, we sold it and we put all our (20:22:20) efforts into that.
LISOVICZ: So talk to me about that, because it’s not like there’s any shortage of jewelry stores and you’re a high-end jewelry store at that, taking on the (20:22:30) Tiffany’s (Company: Tiffany & Company; Ticker: TIF; URL: http://www.tiffany.com/) of the world. How do you compete? How do you carve out your own niche when you’re going against those kind of established brands?
AYTON: Well, I think we have a very sort of (20:22:40) British approach to it. It’s our silver design in our jewelry is fun. It’s never quite what it seems. It’s witty. It’s ironic. It’s young and we, there’s a sense of humor.
LISOVICZ: Humor. There really is a sense of humor.
AYTON: . in the (20:22:50) design.
LISOVICZ: But yet it’s very good Links of London Bracelet that will hold up right?
AYTON: It’s heirloom quality. It’s sterling silver. It’s 18 karat gold.
LISOVICZ: What kind of prices do your products range, because it started with the cufflinks, hence the name, but (20:23:00) you’ve expanded greatly now. So what are the range of prices?
AYTON: Well, we start as low as $50 and we go up to $2,000. But I think that our key price point is probably (20:23:10) $150 to $250.
LISOVICZ: One of the problems you see with something that is fashion driven in any way is expansion too quickly. You’re now in a couple of dozen stores around (20:23:20) the world. A second store coming up in New York in the high end rent district. You’ve got one on Madison Avenue, one going on Park. Is there any fear that you might be growing a (20:23:30) little bit too quickly?
AYTON: Well, I think we’ve had to be careful. We have waited a year in America. Madison Avenue has been a great success. We’ve waited. We’ve learned a lot over the last year and we (20:23:40) feel ready to open the second one. We wouldn’t be opening the second one unless we were sure of the future of the first. So we’ve been quite cautious in (20:23:50) America and we’re very excited about the prospects.
LISOVICZ: And as I mentioned and as our viewers can see, you’ve really expanded from cufflinks. For instance, you have the birth, congratulations of your fourth child and (20:24:00) you have four children’s lines. Is there any area that you wouldn’t go into that you think is just inappropriate?
AYTON: Well, I think we’re specialists in precious metal. I don’t think we will (20:24:10) start to do leather. I don’t think we will start to do ties. I think that we consider ourselves specialists in gifts and specialists in precious metal and we will (20:24:20) stick to that.
LISOVICZ: How’s it working with your wife who is obviously the creative designer? I mean she’s really been the inspiration for Links of London Bangle and now she’s just given birth to (20:24:30) your fourth child. How active is she and how is that managing a big growing household and a growing business?
AYTON: Well, I think she’s very well organized. And I think that she’s somebody who (20:24:40) designs in her own time and I think the inspiration will come at any time of the day. It’s not a 9 to 5 job. I think she enjoys the balance between the (20:24:50) two. Clearly, she has a team behind her to help her.
LISOVICZ: And you have an excellent track record so far and good luck with your second store opening in New York this (20:25:00) fall. John Ayton, chairman and co-founder of Links of London. Pleasure to meet you.
Q2 2005 Tiffany & Co. Earnings Conference Call – F
OPERATOR: Good day, everyone, and welcome to this buy tiffany bracelets & Company second quarter earnings conference call.
Today’s call is being recorded. Participating on today’s call is the Vice President of Investor Relations, Mr. Mark Aaron, and the Executive Vice President and Chief Financial Officer, Mr. Jim Fernandez.
At this time I would like to turn the call over to Mr. Mark Aaron. Please go ahead, sir.
MARK AARON, VP INVESTOR RELATIONS, Tiffany & COMPANY: Thank you and good morning to all of you.
We hope that by now you have received and read today’s press release. Before continuing please note Tiffany’s Safe Harbor provision as follows.
That statements made on this call that are not historical facts are forward-looking statements. Actual results might differ materially from the expectations projected in those forward-looking statements.
Additional information concerning risk factors that could cause actual results to differ materially is set it forth in Tiffany’s 2004 Annual Report and in Forms 10-K, 10-Q, and 8-K reports filed with the Securities and Exchange Commission. The Company undertakes no obligation to update or revise any forward-looking statements to reflect subsequent events or circumstances.
Now let’s proceed. We presume will you agree that buy tiffany bangles second quarter results were quite good and in certain respects better than we expected.
Net sales rose 11% in the quarter due to geographically broad-based growth. Gross margin was equal to last year, we maintained discipline control over expense growth and achieved solid leverage on fixed costs, and therefore operating earnings rose by a better than expected 27%.
Factoring in a tax benefit resulting from the American Jobs Creation Act that we had anticipated, net earnings rose 53% in the quarter. And growth in earnings per share was slightly higher due to share repurchase activity.
Let’s first look at the dynamics that drove sales growth in our four channels of distribution.
U.S. retail sales rose 8% in the quarter, primarily due to an increase in the average transaction size. Essentially, higher jewelry unit volume was virtually offset by a volume decline in accessories and tableware.
Store traffic was somewhat lower than the prior year but the important conversion rate was higher. Our customer analysis indicated similar growth in sales to local customers and tourists, although the growth in our New York flagship store sales came from higher foreign and domestic tourist spending.
U.S. comparable store sales increased 6% in the quarter, which was in line with our mid to high single-digit expectation and was on top of a 10% comp increase last year.
In terms of the monthly trend comps rose 7% in May, 6% in June, and 4% in July. In last year’s second quarter the 10% comp increase included gains of 12% in May, 8% in June, and 10% in July.
From a geographical perspective second quarter comps rose 3% in the New York flagship store which was on top of a 16% increase last year. We also have seven branch stores in the New York region, and their total sales, including the relatively new Westport store, but excluding the New York flagship, rose 10% in the quarter.
Overall comparable branch store sales rose 6% in the quarter which was on top of a 9% increase last year. Branch stores posting the largest percentage increases included Washington D.C., Charlotte, Coral Gables, and Orlando, as well as stores in Beverly Hills, Palm Desert, and Scottsdale.
We’re also pleased with the success of new stores opened over the past year, including the newest in Carmel, California that we opened in June, and we plan to enter three additional exciting markets this fall.
In terms of U.S. merchandising there was broad-based strength in most buy tiffany necklaces categories and at most price points. Jewelry growth was driven by an increase in unit volume as well as a higher average price.
In addition, from a price stratification perspective, we saw solid growth in virtually every price strata with exceptionally strong growth in sales from 3,000 to $10,000, and in sales over $50,000.
As we reported previously we increased retail prices in the U.S. for diamond and platinum jewelry late in the first quarter in order to offset higher costs. It appears there was no great customer resistance.
We saw continued healthy demand for engagement jewelry due to strength in our core engagement ring icon and in our core fine jewelry collections including Tiffany Hearts, Jazz, Voile and Rose.
The celebration rings campaign continues to be a big success. In fact, several of those exquisite rings are featured in our ad on page A-3 of today’s New York Times.
We’re pleased to note that celebration rings are popular both as self-purchase and as gifts and we will continue to add styles to the assortment.
Statement jewelry sales were especially strong in the colored diamond category, and we are definitely reaping the benefits from the strategic inventory investments we’ve made over the past year or two. Fashion gold jewelry sales were up nicely in the quarter.
We also saw healthy growth in silver jewelry sales, which includes an excellent early response to our new items in the 1837 Collection. And sales of core iconic collections are strong, such as atlas in gold and silver.
The watch category was soft in the second quarter but will receive additional support during the holiday season from the launch of the new Tiffany Grand watch collection.
The News Tribune, Tacoma, Wash., Dan Voelpel column
The National Pawnbrokers Association told The Wall Street Journal this month that its operators around the country report a surge fueled by a new clientele — middle- and upper-middle-class customers driving up in their Cadillacs and BMWs ready to hock their furs, Cartier watches and Tiffany jewelry.
Psychics in Atlanta told the Atlanta Journal Constitution that their clients don’t ask as much about love and health but more and more want advice on some of the most basic and personal of financial and professional matters.
Robert Neumann sees it too. Right here in Tacoma.
Clients, many of them first-timers, have turned to his hypnotherapy practice in hopes of finding their mental equilibrium after losing jobs, facing foreclosure on a home or feeling like a failure for not being able to provide for their families.
"One of the major stressors in life and in marriages is financial issues," Neumann said. "My role is about bringing people back into balance."
Maxine Taylor, an astrologer and a healer near Atlanta, has appeared periodically on CNN and has a client list that includes corporate executives, more of them near desperation. She told the Atlanta newspaper that during good times clients want to know about love, health and money. Now, she said, it’s money, jobs and money.
For Neumann, he normally counts his bread-and-butter clientele as those interested in weight loss and smoking cessation. Now, he said, it’s money issues.
How does a hypnotherapy session help?
"I view myself more like a personal trainer at the gym," said Neumann, who studied Eastern philosophy and tinkered with hypnosis as a teenager in post-World War II Germany.
"If someone’s butt is sagging a little or they want to get rid of that gut, a personal trainer can design exercises to get at those muscles. The mind works the same way. I’m a personal trainer for the mind."
Neumann said he helps people recondition the way they think about themselves and "assist them in using their own mind to achieve their own goals."
When it comes to financial issues, such as losing a job, the depression that follows can muddy one’s mind so much it can’t focus attention and energy on positive strategies to find a new job.
"Fear, fear of the unknown, is very debilitating," Neumann said.
Neumann tailors his hypnotherapy sessions to each client’s specific situation. In his inaugural sessions, he spends the first hour talking with the clients to learn as much as he can about their lives and concerns. The second hour, Neumann uses hypnosis to put them in a relaxed, near-sleep state and plants the seeds of positive thoughts and actions.
Despite the individual nature of the sessions, Neumann said he tells hypnotized clients dealing with financial fears some common things.
For example: "It’s OK for you to relax. Everything will work out fine. You’ve been through difficult times before. You’ll get through this… You have skills. Now you have time to look at those skills and to use them. Your family supports you in difficult times. Take a few breaths and relax.
"There’s plenty of work out there. You’ll find a job. Focus and you’ll be more relaxed… There’s a lot of money circulating out there. When you drive past a restaurant, is the parking lot empty? When you drive past a casino, is the parking lot empty? When you drive past a theater, are the parking lots empty? The answers are… No.
"There’s plenty of money and opportunities out there for you. It’s being calm enough to find them."
Neumann, a hypnotherapist certified by the National Guild of Hypnotists, first operated from a Chinese herbal pharmacy in Tacoma’s Lincoln International District. Now, his practice, The Vital Connection, shares the Milepost Credit Union Building at South 37th Street and Pacific Avenue.
Neumann also recently added a new twist to his practice. He records the audio from the hypnosis session and burns it onto a CD before clients leave the office. That way, he said, they can find a place to relax and reconnect with the positive messages without coming back to see him.
Wherever we find our stress relief, without question America has more stress to relieve. In a survey this month of nearly 1,200 households, Country Family Finances found that 75 percent of Americans reported more stress and one-third reported more arguments.
The impact of the economy showed up most among women, with 81 percent reporting the topic of money and the current economy has been very or somewhat stressful for their family, compared to 65 percent of men giving that response, according to the survey.
So we Americans try new things to cope.
"Even in the worst economy, there’s always… more,’" Neumann said. "At this time, at this point in history, there’s still more money circulating the planet than ever before, more prosperity than ever before, more food, better housing, more water…
"Some people get so wound up and stressed about money and a job they forget to be open to the obvious… They can’t find what’s right in front of their faces."