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Tiffany raises profit outlook; Asia fuels quarterly sales

A woman walks past Tiffany Building at Tokyo's Ginza shopping district October 1, 2013. REUTERS/Toru Hanai
A woman walks past Tiffany Building at Tokyo's Ginza shopping district October 1, 2013. REUTERS/Toru Hanai

(Reuters) - Tiffany & Co on Tuesday reported a higher quarterly profit, helped by stronger-than-expected sales in Asia, and the U.S. jeweler raised its full-year forecast.

The company's shares rose 5.5 percent to $86 in premarket trading.

Global sales rose 7 percent to $911.5 million in the third quarter ended October 31. Analysts on average were expecting $889.5 million, according to Thomson Reuters I/B/E/S.

Comparable sales, which include those at stores open at least a year and from e-commerce, rose 7 percent.

The increase was most pronounced in Asia, excluding Japan. Comparable sales in the region, where Tiffany now gets almost one-quarter of sales and is expanding aggressively, rose 22 percent, well above analysts' expectations.

But in other regions, Tiffany's business grew more modestly.

In the Americas, comparable sales rose 1 percent, helped by strong sales at the jeweler's famed Fifth Avenue flagship. This suggests the other U.S. stores did not fare as well.

In Europe, comparable sales increased 2 percent.

In the United States, Tiffany's biggest market the company has struggled to find the right mix of the expensive jewelry for which it is known and the more-affordable silver items, typically less than $500, that generate 25 percent of sales and comprise its most profitable category.

Signet Jewelers Ltd , which operates the Kay Jewelers and Jared chains, said its U.S. same-store sales had risen 4.2 percent in the quarter.

Tiffany reported net income of $94.6 million, or 73 cents per share, compared with $63.2 million, or 49 cents per share, a year earlier. The company raised its full-year profit forecast by 15 cents per share to a range of $3.65 to $3.75.

Tiffany still expects net sales worldwide to increase by a mid-single-digit percentage rate for the fiscal year.

(Reporting by Phil Wahba in New York; Editing by Lisa Von Ahn)

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