Tiffany & Co. announces departure of its CEO Frederic Cumenal

  • Frederic Cumenal Steps Down as CEO
  • Chairman Michael Kowalski Will Serve as Interim CEO; Board Will Work with Executive Search Firm to Recruit Successor
  • Reaffirms FY 2016 Earnings Guidance

NEW YORK, 2017-Feb-07 — /EPR Retail News/ — Tiffany & Co. (NYSE:TIF) today (February 5, 2017 ) announced that Frederic Cumenal has stepped down as Chief Executive Officer, effective immediately. The Board of Directors has commenced a search to recruit a successor in which it will be assisted by a leading executive search firm. During this process, Michael J. Kowalski, Chairman of the Board of Directors and previous CEO of Tiffany, will serve as Interim CEO while continuing as Chairman.

“On behalf of the entire Board of Directors, I would like to thank Frederic Cumenal for his contributions to Tiffany,” said Mr. Kowalski. “At a time of continuing challenges in the global luxury market, Frederic has enhanced the management team and taken important steps to position Tiffany for success in the long term. We wish him the best in his future endeavors.”

Mr. Kowalski continued, “The Board is committed to our current core business strategies, but has been disappointed by recent financial results. The Board believes that accelerating execution of those strategies is necessary to compete more effectively in today’s global luxury market and improve performance. As such, we remain focused on enhancing the customer experience, increasing the rate of new product introductions and innovation, maximizing marketing effectiveness, optimizing the store network, and improving our business operations and processes, all while efficiently managing our capital and costs. We believe these initiatives and the pace of their execution are key to driving shareholder value. Tiffany is an iconic brand with a family of talented and committed employees to match, and I look forward to supporting both during the transition.”

Mr. Cumenal said, “I am proud of what we have accomplished at Tiffany and would like to thank the management team and our many talented employees around the world with whom I have had the pleasure to work. I have great confidence in Tiffany’s brand, strategic direction and people, and I believe the Company will have many exciting opportunities in the future.”

Reaffirms Annual Guidance

The Company also affirmed, based on its plans and assumptions detailed in the January 17, 2017 holiday period sales news release, its fiscal year 2016 guidance described in that press release. The Company expects to report its fourth quarter and full 2016 fiscal year results, and also to provide its expectations for the 2017 fiscal year, on March 17 before the market opens.

Tiffany is the internationally renowned jeweler founded in New York in 1837. Through its subsidiaries, Tiffany & Co. manufactures products and operates TIFFANY & CO. retail stores worldwide, and also engages in direct selling through Internet, catalog and business gift operations. For additional information, please visit www.tiffany.com or call our shareholder information line at 800-TIF-0110.

Forward-Looking Statements:

Statements contained in this document that are not statements of historical fact, including those that refer to the Company’s search for a successor CEO, the Company’s strategy and initiatives and the pace of execution thereon, the Company’s objectives to compete in the global luxury market and to improve financial performance, and the Company’s fiscal year 2016 guidance, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

The potential risks and uncertainties that could cause the Company’s actual results, performance or achievements to differ from the predicted results, performance or achievements include, among others, global macroeconomic and geopolitical developments; changes in interest and foreign currency rates; changes in taxation policies and regulations; shifting tourism trends; regional instability, violence (including terrorist activities), political activities or events, and weather conditions that may affect local and tourist consumer spending; changes in consumer confidence, preferences and shopping patterns, as well as our ability to accurately predict and timely respond to such changes; shifts in the Company’s product and geographic sales mix; variations in the cost and availability of diamonds, gemstones and precious metals; changes in our competitive landscape; our ability to successfully control costs and execute on, and achieve the expected benefits from, our operational and strategic initiatives, and any difficulties or delays we encounter in identifying a successor CEO.

Additional information about potential risks and uncertainties that could affect the Company’s business and financial results is included in the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2016, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and the Company’s Press Release dated January 17, 2017. The Company undertakes no obligation to update or revise any forward-looking statements to reflect subsequent events or circumstances, except as required by applicable law or regulation.

Contact:
Mark L. Aaron
212-230-5301
mark.aaron@tiffany.com

Source: Tiffany & Co.

Tiffany & Co. announces the appointment of Reed Krakoff as Chief Artistic Officer

NEW YORK, 2017-Jan-18 — /EPR Retail News/ — Tiffany & Co. (NYSE:TIF) today (January 17, 2017 ) announced that Reed Krakoff will join Tiffany in the new position of Chief Artistic Officer, effective February 1. Reed will direct design for TIFFANY & CO. brand jewelry, as well as luxury accessories, and lead the brand’s overarching artistic and design vision with respect to stores, e-commerce, marketing and advertising.

In 2016, Reed served as a creative collaborator for Tiffany with the re-launch of a luxury accessories collection, which the Company anticipates will debut for Holiday 2017.

Reed’s appointment to this new position continues Tiffany’s mission for the past 180 years – to create the most important and beautiful jewelry, accessories and objects for the home – and advances its global commitment to excellence in design, using exemplary materials and craftsmanship.

“Reed’s extraordinary talent and deep understanding of iconic American design, and Tiffany’s defining role in its legacy, make him poised for great success in this new position,” said Frederic Cumenal, chief executive officer of Tiffany & Co. “His expertise and creativity will continue to help build Tiffany as a global house of luxury.”

A three-time CFDA Award winner, Reed is celebrated globally for his contributions to the worlds of fashion, interior design and the arts. Reed formerly served as president and executive creative director of Coach, after holding a senior design role at Ralph Lauren, and most recently helmed his eponymous luxury fashion line of womenswear and accessories.

“I’m honored to join Tiffany as Chief Artistic Officer and fully dedicate my creative focus to this storied American luxury brand,” said Reed Krakoff. “The exceptional opportunity to further Tiffany’s rich creative legacy of design and craftsmanship, and join the incredible talent within Tiffany, is truly inspiring.”

After three-and-a-half years, Francesca Amfitheatrof – who served as Design Director and was responsible for the design of Tiffany & Co. brand jewelry – will leave the Company to pursue other opportunities. She has made important contributions to the portfolio, and Tiffany is deeply grateful for the unique creative perspective she brought to the brand.

Tiffany is the internationally renowned jeweler founded in New York in 1837. Through its subsidiaries, Tiffany & Co. manufactures products and operates TIFFANY & CO. retail stores worldwide, and also engages in direct selling through Internet, catalog and business gift operations. For additional information, please visit Tiffany.com.

Contact:
Nathan Strauss
646-428-5941
Director, Corporate Communications
nathan.strauss@tiffany.com

Ashley Barrett
Vice President
Global Public Relations
ashley.barrett@tiffany.com

Source: Tiffany & Co.

Tiffany & Co. announces sales results for the holiday period

NEW YORK, 2017-Jan-18 — /EPR Retail News/ — Tiffany & Co. (NYSE:TIF) reported its sales results for the two months ended December 31, 2016 (“holiday period”). Worldwide net sales of $966 million were slightly above $961 million a year ago, with sales growth in Asia-Pacific and Japan largely offset by lower sales in the Americas and Europe; worldwide comparable store sales declined 2%. On a constant-exchange-rate basis that excludes the effect of translating foreign-currency-denominated sales into U.S. dollars (see “Non-GAAP Measures”), worldwide net sales rose 1% from the prior year and comparable store sales declined 1%. There were no significant variations in performance among jewelry categories.

Frederic Cumenal, chief executive officer, said, “These overall holiday period sales results were somewhat lower than we had anticipated, but we continue to benefit from a favorable gross margin and prudent expense management. Although we do not anticipate any significant improvement in 2017 to the macroeconomic challenges that we faced this year, we continue to focus on our initiatives to enhance our stores and our customers’ experience, and to add newness to our product assortment, while maintaining effective marketing communications and a well-developed supply chain. We believe executing on these initiatives, which are within our control, will contribute over the long-term to strengthening Tiffany’s competitive position among global luxury brands.”

Net sales by region were as follows:

  • In the Americas, both total sales of $483 million and comparable store sales were 4% below the prior year. On a constant-exchange-rate basis, total sales declined 4% and comparable store sales declined 3%. Management attributed the lower sales to local customer spending, with a decline in U.S. sales exacerbated by a 14% decline at the Company’s Flagship store on Fifth Avenue in New York, which we attribute at least partly to post-election traffic disruptions.
  • In the Asia-Pacific region, total sales increased 7% to $200 million and comparable store sales declined 4%. On a constant-exchange-rate basis, total sales rose 9% and comparable store sales declined 3%. Management noted strong growth in retail sales in China and in wholesale sales in Korea, but softness in most other markets throughout the region.
  • In Japan, total sales rose 16% to $143 million and comparable store sales rose 21%, which management attributed to higher spending by local customers. On a constant-exchange-rate basis, total sales increased 8% and comparable store sales rose 12%. Strong retail sales growth was partly offset by lower wholesale sales.
  • In Europe, total sales of $119 million were 10% below the prior year and comparable store sales declined 11%. On a constant-exchange-rate basis, total sales were equal to the prior year and comparable store sales were 4% below the prior year. Management attributed the sales performance to weak demand across continental Europe tied to domestic and foreign tourist spending, and noted modest growth in local-currency sales in the United Kingdom.
  • Other sales of $20 million rose 33% and comparable store sales declined 7% reflecting increased wholesale sales of diamonds, offset by lower retail sales in the United Arab Emirates (“UAE”).
  • At December 31, 2016, the Company operated 314 stores (125 in the Americas, 86 in Asia-Pacific, 55 in Japan, 43 in Europe, and five in the UAE), versus 307 stores a year ago (125 in the Americas, 81 in Asia-Pacific, 56 in Japan, 40 in Europe, and five in the UAE).

Full Year 2016 Outlook:

For the full 2016 fiscal year, (i) management expects earnings per diluted share to decline by no more than a mid-single-digit percentage on a GAAP basis, as well as on an adjusted basis (which in 2016 excludes a charge of approximately $0.13per diluted share to be recorded in the fourth quarter of 2016 related to the impairment of capitalized costs for the development of a replacement of the Company’s finished goods inventory management system, and, in 2015, excluded loan impairment and certain staffing and occupancy charges – see “Non-GAAP Measures”); and (ii) management continues to expect worldwide net sales declining by a low single-digit percentage from the prior year. These expectations are approximations and are based on the Company’s plans and assumptions, including: (i) worldwide gross retail square footage increasing 3%, net through 11 store openings, 5 relocations and 6 closings; (ii) operating margin below the prior year due to an anticipated increase in gross margin more than offset by SG&A expense growth; (iii) interest and other expenses, net lower than 2015; (iv) an effective income tax rate consistent with the prior year; (v) the U.S. dollar unchanged at current spot rates versus other foreign currencies for the balance of the year; and (vi) weighted average diluted shares outstanding lower than in fiscal 2015. Management also expects for the full 2016 fiscal year: net cash provided by operating activities of more than $575 million and free cash flow (net cash provided by operating activities less capital expenditures – see “Non-GAAP Measures”) of more than $325 million, both of which now include a previously-unplanned and voluntary contribution of $125 million to the Company’s U.S. pension plan. These expectations are approximations and are based on the Company’s plans and assumptions, including: (i) net inventories below the prior year, (ii) capital expenditures of $240 million and (iii) net earnings in line with management’s expectations described above.

Next Scheduled Announcement:

The Company expects to report its fourth quarter and full year results on Friday March 17th before the market opens. To be notified of future announcements, please register at http://investor.tiffany.com (“E-Mail Alerts”).

Tiffany is the internationally-renowned jeweler founded in New York in 1837. Through its subsidiaries, Tiffany & Co. manufactures products and operates TIFFANY & CO. retail stores worldwide, and also engages in direct selling through Internet, catalog and business gift operations. For additional information, please visit www.tiffany.com or call our shareholder information line at 800-TIF-0110.

Forward-Looking Statements:

The historical trends and results reported in this document should not be considered an indication of future performance. Further, statements contained in this document that are not statements of historical fact, including those that refer to plans, assumptions and expectations for the current fiscal year and future periods, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, the statements under “Full Year 2016 Outlook” as well as statements that can be identified by the use of words such as ‘expects,’ ‘projects,’ ‘anticipates,’ ‘assumes,’ ‘forecasts,’ ‘plans,’ ‘believes,’ ‘intends,’ ‘estimates,’ ‘pursues,’ ‘continues,’ ‘outlook,’ ‘may,’ ‘will,’ ‘can,’ ‘should’ and variations of such words and similar expressions. Examples of forward-looking statements include, but are not limited to, statements we make regarding the Company’s plans, assumptions, expectations, beliefs and objectives with respect to store openings and closings; product introductions; sales; sales growth; sales trends; store traffic; competitive position; retail prices; gross margin; operating margin; expenses; interest and other expenses, net; effective income tax rate; net earnings and net earnings per share; share count; inventories; capital expenditures; cash flow; liquidity; currency translation; macroeconomic conditions; growth opportunities; litigation outcomes and recovery related thereto; the collectability of amounts due under financing arrangements with diamond mining and exploration companies; contributions to Company pension plans; and certain ongoing or planned real estate, product, marketing, retail, customer experience, manufacturing, supply chain, information systems development, upgrades and replacement, and other operational and strategic initiatives.

These forward-looking statements are based upon the current views and plans of management, speak only as of the date on which they are made and are subject to a number of risks and uncertainties, many of which are outside of our control. Actual results could therefore differ materially from the planned, assumed or expected results expressed in, or implied by, these forward-looking statements. While we cannot predict all of the factors that could form the basis of such differences, key factors include, but are not limited to: global macroeconomic and geopolitical developments; changes in interest and foreign currency rates; changes in taxation policies and regulations; shifting tourism trends; regional instability, violence (including terrorist activities), election-related or other political activities or events, and weather conditions that may affect local and tourist consumer spending; changes in consumer confidence, preferences and shopping patterns, as well as our ability to accurately predict and timely respond to such changes; shifts in the Company’s product and geographic sales mix; variations in the cost and availability of diamonds, gemstones and precious metals; changes in our competitive landscape; disruptions impacting the Company’s business and operations; failure to successfully implement or make changes to the Company’s information systems; gains or losses in the trading value of the Company’s stock, which may impact the amount of stock repurchased; and our ability to successfully control costs and execute on, and achieve the expected benefits from, the operational and strategic initiatives referenced above. Developments relating to these and other factors may also warrant changes to the Company’s operating and strategic plans, including with respect to store openings, closings and renovations, capital expenditures, information systems development, inventory management, and continuing execution on, or timing of, the aforementioned initiatives. Such changes could also cause actual results to differ materially from the expected results expressed in, or implied by, the forward-looking statements.

Additional information about potential risks and uncertainties that could affect the Company’s business and financial results is included under “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2016 and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s most recent quarterly report on Form 10-Q. Readers of these documents should consider the risks, uncertainties and factors outlined above and in the Form 10-K in evaluating, and are cautioned not to place undue reliance on, the forward-looking statements contained herein. The Company undertakes no obligation to update or revise any forward-looking statements to reflect subsequent events or circumstances, except as required by applicable law or regulation.

TIFFANY & CO. AND SUBSIDIARIES
(Unaudited)

NON-GAAP MEASURES

The Company reports information in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”). Internally, management also monitors and measures its performance using certain sales and earnings measures that include or exclude amounts, or are subject to adjustments that have the effect of including or excluding amounts, from the most directly comparable GAAP measure (“non-GAAP financial measures”). The Company presents such non-GAAP financial measures in reporting its financial results to provide investors with useful supplemental information that will allow them to evaluate the Company’s operating results using the same measures that management uses to monitor and measure its performance. The Company’s management does not, nor does it suggest that investors should, consider non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. These non-GAAP financial measures presented here may not be comparable to similarly-titled measures used by other companies.

Net Sales

The Company’s reported net sales reflect either a translation-related benefit from strengthening foreign currencies or a detriment from a strengthening U.S. dollar. Internally, management monitors and measures its sales performance on a non-GAAP basis that eliminates the positive or negative effects that result from translating sales made outside the U.S. into U.S. dollars (“constant-exchange-rate basis”). Sales on a constant-exchange-rate basis are calculated by taking the current year’s sales in local currencies and translating them into U.S. dollars using the prior year’s foreign exchange rates. Management believes this constant-exchange-rate basis provides a useful supplemental basis for the assessment of sales performance and of comparability between reporting periods.

Free Cash Flow

Internally, management monitors its cash flow on a non-GAAP basis. Free cash flow is calculated by deducting capital expenditures from net cash provided by operating activities. The ability to generate free cash flow demonstrates how much cash the Company has available for discretionary and non-discretionary purposes after deduction of capital expenditures. The Company’s operations require regular capital expenditures for the opening, renovation and expansion of stores and distribution and manufacturing facilities as well as ongoing investments in information technology. Management believes this provides a useful supplemental basis for assessing the Company’s operating cash flows.

Contact:
Mark L. Aaron
212-230-5301
mark.aaron@tiffany.com

Source: Tiffany & Co.

Tiffany & Co. announces 3Q 2016 financial results

NEW YORK, 2016-Dec-01 — /EPR Retail News/ — Tiffany & Co. (NYSE:TIF) reported that worldwide net sales increased 1% in the three months (“third quarter”) ended October 31, 2016, reflecting mixed results across geographic regions and product categories. Net earnings increased 5% in the third quarter and earnings per diluted share rose 9%.

In the third quarter:

  • Worldwide net sales rose 1% to $949 million and comparable store sales declined 2%. A modest increase in fashion jewelry sales was offset by softness in other product categories. On a constant-exchange-rate basis that excludes the effect of translating foreign-currency-denominated sales into U.S. dollars (see “Non-GAAP Measures”), worldwide net sales were unchanged from the prior year and comparable store sales declined 3%.
  • Net earnings increased 5% to $95 million, or $0.76 per diluted share, from $91 million, or $0.70 per diluted share, in the prior year. The earnings growth reflects an improvement in gross margin and, to a lesser extent, lower interest and other expenses, partly offset by a lack of sales leverage on selling, general and administrative expenses.

In the year-to-date (nine months ended October 31):

  • Worldwide net sales of $2.8 billion were 4% below the prior year, and comparable store sales declined 6% due to varying rates of decline in all regions except Japan. On a constant-exchange-rate basis, worldwide net sales and comparable store sales were 4% and 7%, respectively, below the prior year.
  • Net earnings were $288 million, or $2.29 per diluted share, compared with $301 million, or $2.32 per diluted share, in the prior year. Earnings in the current year-to-date included a tax benefit of $0.05 per diluted share in the first quarter related to the settlement of a tax examination. Earnings in the first nine months of the prior year included an impairment charge of $0.05 per diluted share in the second quarter in respect of a loan to a diamond mining company (see “Non-GAAP Measures”).

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.”

He added, “This year, we’ve added exciting new designs across our jewelry and watch categories and are pleased with initial customer response. As the global environment continues to reflect economic and other challenges that we believe are continuing to affect customer demand, it is more important than ever that we remain focused on strategies to deliver extraordinary products and experiences to our customers. Over the long-term, our objective is to enhance profitability and productivity through sales growth and prudent expense and inventory management, while further strengthening our competitive position among global luxury brands.”

Net sales by region were as follows:

  • In the Americas, total sales of $417 million in the third quarter were 2% below the prior year, and sales of $1.25 billion in the year-to-date were 7% below the prior year; comparable store sales declined 2% and 7% in the respective periods. On a constant-exchange-rate basis, total sales declined 2% in the third quarter and 6% in the year-to-date; comparable store sales declined 2% and 7%, respectively. Management attributed the sales decline in the quarter to lower spending by U.S. customers which was largely offset by higher spending attributed to foreign tourists primarily from Japan.
  • In the Asia-Pacific region, total sales rose 4% to $247 million in the third quarter and declined 4% to $715 million in the year-to-date; comparable store sales declined 7% and 11%, respectively. On a constant-exchange-rate basis, total sales rose 3% in the third quarter and declined 2% in the year-to-date; comparable store sales declined 7% and 10%, respectively. In the quarter, management noted double-digit sales growth in China, solid retail and wholesale sales growth in Korea and a decelerating rate of sales decline in Hong Kong, as well as continued sales declines in Australia and Singapore.
  • In Japan, sales benefited from the yen strengthening versus the U.S. dollar, with total sales increasing 13% to $150 million in the third quarter and 10% to $419 million in the year-to-date, but were negatively affected by lower wholesale sales; comparable store sales rose 20% and 15%, respectively. However, on a constant-exchange-rate basis, total sales declined 4% in the third quarter and 3% in the year-to-date, reflecting lower wholesale sales, while comparable store sales rose 2% and 1%, respectively. Management noted higher spending attributed to local customers in the quarter, along with lower spending attributed to Chinese tourists in both periods.
  • In Europe, total sales declined 10% to $104 million in the third quarter and 10% to $312 million in the year-to-date; comparable store sales declined 14% and 15%, respectively. On a constant-exchange-rate basis, total sales declined 2% in the third quarter and 6% in the year-to-date; comparable store sales declined 7% and 11%, respectively. Management attributed soft demand across continental Europe, especially in France, to both local customers and foreign tourists, while strong local-currency sales growth in the United Kingdom was primarily attributable to higher foreign tourist spending.
  • Other sales rose 18% to $31 million in the third quarter due to increased wholesale sales of diamonds, and declined 7% to $71 million in the year-to-date as an increase in wholesale sales of diamonds was offset by lower retail sales in the United Arab Emirates (“UAE”). Comparable store sales declined 12% and 19% in the respective periods.
  • Tiffany opened four Company-operated stores in the third quarter and closed two existing locations, all in the Asia-Pacific region. At October 31, 2016, the Company operated 313 stores (125 in the Americas, 85 in Asia-Pacific, 55 in Japan, 43 in Europe, and five in the UAE), versus 305 stores a year ago (125 in the Americas, 79 in Asia-Pacific, 56 in Japan, 40 in Europe, and five in the UAE).

Other highlights:

  • Gross margins (gross profit as a percentage of net sales) of 61.0% in the third quarter and 61.4% in the year-to-date were higher than 60.2% and 59.7%, respectively, in the prior year. The increases were due to lower product input costs, changes in product sales mix and price increases taken in the past year, partly offset by the impact of increased wholesale sales of diamonds.
  • SG&A expenses increased 4% in the third quarter primarily due to increases in store occupancy and depreciation expenses, marketing expenses, and labor and incentive compensation costs. SG&A expenses rose 1% in the year-to-date, primarily reflecting increased store occupancy and depreciation expenses, lower benefit costs and the effect of a loan impairment charge recorded last year.
  • The effective tax rates were 34.6% in the third quarter and 33.0% in the year-to-date, versus 35.5% and 34.8%, respectively, in the prior-year. The decline from last year in the year-to-date effective tax rate reflected the favorable impact of the conclusion of a tax examination in this year’s first quarter.
  • Cash and cash equivalents and short-term investments were $787 million at October 31, 2016, versus $725 million at October 31, 2015. Total debt (short-term and long-term) as a percentage of stockholders’ equity was 38% at October 31, 2016 and 37% at October 31, 2015.
  • Net inventories at October 31, 2016 were 2% lower than at October 31, 2015.
  • Capital expenditures were $157 million and $159 million in the nine months ended October 31, 2016 and 2015.
  • The Company repurchased approximately 455,000 shares of its Common Stock in the third quarter at an average cost of approximately $68 per share, and repurchased approximately 2.8 million shares at an average cost of approximately $65 per share in the year-to-date. At October 31, 2016, approximately $313 million remained available for repurchases under a program that authorizes the repurchase of up to $500 million of the Company’s Common Stock and that expires on January 31, 2019.
  • With respect to the impact of recent election-related activity near the Company’s New York Flagship store, management has noted some adverse effect on traffic in that store and a continuation of sales softness relative to prior year and to the Company’s other U.S. stores this year. That store represented less than 10% of worldwide net sales for the three and nine-month periods ended October 31, 2016, as well as for each quarter in fiscal 2015. The Company cannot provide any assurance that sales in that store will not be negatively affected by this activity in the fourth quarter or in any future period.

Outlook:

For the full 2016 fiscal year, management is maintaining its outlook to expect: (i) worldwide net sales declining by a low single-digit percentage from the prior year and (ii) earnings per diluted share declining by a mid-single-digit percentage from 2015’s adjusted earnings (which excluded loan impairment and certain staffing and occupancy charges – see “Non-GAAP Measures”). These expectations are approximations and are based on the Company’s plans and assumptions, including: (i) worldwide gross retail square footage increasing 3%, net through 11 store openings, 6 relocations and 6 closings; (ii) operating margin below the prior year (excluding the prior year’s charges – see “Non-GAAP Measures”) due to an anticipated increase in gross margin more than offset by SG&A expense growth; (iii) interest and other expenses, net unchanged from 2015; (iv) an effective income tax rate lower than the prior year; (v) the U.S. dollar unchanged at current spot rates versus other foreign currencies for the balance of the year; and (vi) weighted average diluted shares outstanding lower than in fiscal 2015.

Management also expects for the full 2016 fiscal year: (i) net cash provided by operating activities of at least $660 million and (ii) free cash flow (net cash provided by operating activities less capital expenditures – see “Non-GAAP Measures”) of at least $400 million. These expectations are approximations and are based on the Company’s plans and assumptions, including: (i) net inventories unchanged from the prior year, (ii) capital expenditures of $250 million and (iii) net earnings in line with management’s expectations as described above.

Today’s Conference Call:

The Company will conduct a conference call today at 8:30 a.m. (Eastern Time) to review actual results and the outlook. Please click on http://investor.tiffany.com (“Events and Presentations”).

Next Scheduled Announcements:

The Company expects to report its sales results for the two month holiday period ending December 31, 2016 on Tuesday January 17th before the market opens. To be notified of future announcements, please register at http://investor.tiffany.com (“E-Mail Alerts”).

Tiffany is the internationally-renowned jeweler founded in New York in 1837. Through its subsidiaries, Tiffany & Co. manufactures products and operates TIFFANY & CO. retail stores worldwide, and also engages in direct selling through Internet, catalog and business gift operations. For additional information, please visit www.tiffany.com or call our shareholder information line at 800-TIF-0110.

Forward-Looking Statements:

The historical trends and results reported in this document and on our third quarter earnings call should not be considered an indication of future performance. Further, statements contained in this document and made on such call that are not statements of historical fact, including those that refer to plans, assumptions and expectations for the current fiscal year and future periods, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, the statements under “Outlook” as well as statements that can be identified by the use of words such as ‘expects,’ ‘projects,’ ‘anticipates,’ ‘assumes,’ ‘forecasts,’ ‘plans,’ ‘believes,’ ‘intends,’ ‘estimates,’ ‘pursues,’ ‘continues,’ ‘outlook,’ ‘may,’ ‘will,’ ‘can,’ ‘should’ and variations of such words and similar expressions. Examples of forward-looking statements include, but are not limited to, statements we make regarding the Company’s plans, assumptions, expectations, beliefs and objectives with respect to store openings and closings; product introductions; sales; sales growth; sales trends; store traffic; retail prices; gross margin; operating margin; expenses; interest and other expenses, net; effective income tax rate; net earnings and net earnings per share; share count; inventories; capital expenditures; cash flow; liquidity; currency translation; growth opportunities; litigation outcomes and recovery related thereto; the collectability of amounts due under financing arrangements with diamond mining and exploration companies; and certain ongoing or planned product, marketing, retail, manufacturing, information systems development, upgrades and replacement, and other operational and strategic initiatives.

These forward-looking statements are based upon the current views and plans of management, speak only as of the date on which they are made and are subject to a number of risks and uncertainties, many of which are outside of our control. Actual results could therefore differ materially from the planned, assumed or expected results expressed in, or implied by, these forward-looking statements. While we cannot predict all of the factors that could form the basis of such differences, key factors include, but are not limited to: global macroeconomic and geopolitical developments; changes in interest and foreign currency rates; shifting tourism trends; regional instability, violence (including terrorist activities), election-related or other political activities or events, and weather conditions that may affect local and tourist consumer spending; changes in consumer confidence, preferences and shopping patterns, as well as our ability to accurately predict and timely respond to such changes; shifts in the Company’s product and geographic sales mix; variations in the cost and availability of diamonds, gemstones and precious metals; changes in our competitive landscape; disruptions impacting the Company’s business and operations; failure to successfully implement or make changes to the Company’s information systems; gains or losses in the trading value of the Company’s stock, which may impact the amount of stock repurchased; and our ability to successfully control costs and execute on, and achieve the expected benefits from, the operational and strategic initiatives referenced above. Developments relating to these and other factors may also warrant changes to the Company’s operating and strategic plans, including with respect to store openings, closings and renovations, capital expenditures, information systems development, inventory management, and continuing execution on, or timing of, the aforementioned initiatives. Such changes could also cause actual results to differ materially from the expected results expressed in, or implied by, the forward-looking statements.

Additional information about potential risks and uncertainties that could affect the Company’s business and financial results is included under “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2016 and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s most recent quarterly report on Form 10-Q. Readers of these documents should consider the risks, uncertainties and factors outlined above and in the Form 10-K in evaluating, and are cautioned not to place undue reliance on, the forward-looking statements contained herein. The Company undertakes no obligation to update or revise any forward-looking statements to reflect subsequent events or circumstances, except as required by applicable law or regulation.

Contact:
Mark L. Aaron
212-230-5301
mark.aaron@tiffany.com

Source: Tiffany & Co.

Tiffany & Co. reports 3Q 2016 results

NEW YORK, 2016-Nov-29 — /EPR Retail News/ — Tiffany & Co. (NYSE:TIF) reported that worldwide net sales increased 1% in the three months (“third quarter”) ended October 31, 2016, reflecting mixed results across geographic regions and product categories. Net earnings increased 5% in the third quarter and earnings per diluted share rose 9%.

In the third quarter:

  • Worldwide net sales rose 1% to $949 million and comparable store sales declined 2%. A modest increase in fashion jewelry sales was offset by softness in other product categories. On a constant-exchange-rate basis that excludes the effect of translating foreign-currency-denominated sales into U.S. dollars (see “Non-GAAP Measures”), worldwide net sales were unchanged from the prior year and comparable store sales declined 3%.
  • Net earnings increased 5% to $95 million, or $0.76 per diluted share, from $91 million, or $0.70 per diluted share, in the prior year. The earnings growth reflects an improvement in gross margin and, to a lesser extent, lower interest and other expenses, partly offset by a lack of sales leverage on selling, general and administrative expenses.

In the year-to-date (nine months ended October 31):

  • Worldwide net sales of $2.8 billion were 4% below the prior year, and comparable store sales declined 6% due to varying rates of decline in all regions except Japan. On a constant-exchange-rate basis, worldwide net sales and comparable store sales were 4% and 7%, respectively, below the prior year.
  • Net earnings were $288 million, or $2.29 per diluted share, compared with $301 million, or $2.32 per diluted share, in the prior year. Earnings in the current year-to-date included a tax benefit of $0.05 per diluted share in the first quarter related to the settlement of a tax examination. Earnings in the first nine months of the prior year included an impairment charge of $0.05 per diluted share in the second quarter in respect of a loan to a diamond mining company (see “Non-GAAP Measures”).

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.”

He added, “This year, we’ve added exciting new designs across our jewelry and watch categories and are pleased with initial customer response. As the global environment continues to reflect economic and other challenges that we believe are continuing to affect customer demand, it is more important than ever that we remain focused on strategies to deliver extraordinary products and experiences to our customers. Over the long-term, our objective is to enhance profitability and productivity through sales growth and prudent expense and inventory management, while further strengthening our competitive position among global luxury brands.”

Net sales by region were as follows:

  • In the Americas, total sales of $417 million in the third quarter were 2% below the prior year, and sales of $1.25 billion in the year-to-date were 7% below the prior year; comparable store sales declined 2% and 7% in the respective periods. On a constant-exchange-rate basis, total sales declined 2% in the third quarter and 6% in the year-to-date; comparable store sales declined 2% and 7%, respectively. Management attributed the sales decline in the quarter to lower spending by U.S. customers which was largely offset by higher spending attributed to foreign tourists primarily from Japan.
  • In the Asia-Pacific region, total sales rose 4% to $247 million in the third quarter and declined 4% to $715 million in the year-to-date; comparable store sales declined 7% and 11%, respectively. On a constant-exchange-rate basis, total sales rose 3% in the third quarter and declined 2% in the year-to-date; comparable store sales declined 7% and 10%, respectively. In the quarter, management noted double-digit sales growth in China, solid retail and wholesale sales growth in Korea and a decelerating rate of sales decline in Hong Kong, as well as continued sales declines in Australia and Singapore.
  • In Japan, sales benefited from the yen strengthening versus the U.S. dollar, with total sales increasing 13% to $150 million in the third quarter and 10% to $419 million in the year-to-date, but were negatively affected by lower wholesale sales; comparable store sales rose 20% and 15%, respectively. However, on a constant-exchange-rate basis, total sales declined 4% in the third quarter and 3% in the year-to-date, reflecting lower wholesale sales, while comparable store sales rose 2% and 1%, respectively. Management noted higher spending attributed to local customers in the quarter, along with lower spending attributed to Chinese tourists in both periods.
  • In Europe, total sales declined 10% to $104 million in the third quarter and 10% to $312 million in the year-to-date; comparable store sales declined 14% and 15%, respectively. On a constant-exchange-rate basis, total sales declined 2% in the third quarter and 6% in the year-to-date; comparable store sales declined 7% and 11%, respectively. Management attributed soft demand across continental Europe, especially in France, to both local customers and foreign tourists, while strong local-currency sales growth in the United Kingdom was primarily attributable to higher foreign tourist spending.
  • Other sales rose 18% to $31 million in the third quarter due to increased wholesale sales of diamonds, and declined 7% to $71 million in the year-to-date as an increase in wholesale sales of diamonds was offset by lower retail sales in the United Arab Emirates (“UAE”). Comparable store sales declined 12% and 19% in the respective periods.
  • Tiffany opened four Company-operated stores in the third quarter and closed two existing locations, all in the Asia-Pacific region. At October 31, 2016, the Company operated 313 stores (125 in the Americas, 85 in Asia-Pacific, 55 in Japan, 43 in Europe, and five in the UAE), versus 305 stores a year ago (125 in the Americas, 79 in Asia-Pacific, 56 in Japan, 40 in Europe, and five in the UAE).

Other highlights:

  • Gross margins (gross profit as a percentage of net sales) of 61.0% in the third quarter and 61.4% in the year-to-date were higher than 60.2% and 59.7%, respectively, in the prior year. The increases were due to lower product input costs, changes in product sales mix and price increases taken in the past year, partly offset by the impact of increased wholesale sales of diamonds.
  • SG&A expenses increased 4% in the third quarter primarily due to increases in store occupancy and depreciation expenses, marketing expenses, and labor and incentive compensation costs. SG&A expenses rose 1% in the year-to-date, primarily reflecting increased store occupancy and depreciation expenses, lower benefit costs and the effect of a loan impairment charge recorded last year.
  • The effective tax rates were 34.6% in the third quarter and 33.0% in the year-to-date, versus 35.5% and 34.8%, respectively, in the prior-year. The decline from last year in the year-to-date effective tax rate reflected the favorable impact of the conclusion of a tax examination in this year’s first quarter.
  • Cash and cash equivalents and short-term investments were $787 million at October 31, 2016, versus $725 million at October 31, 2015. Total debt (short-term and long-term) as a percentage of stockholders’ equity was 38% at October 31, 2016 and 37% at October 31, 2015.
  • Net inventories at October 31, 2016 were 2% lower than at October 31, 2015.
  • Capital expenditures were $157 million and $159 million in the nine months ended October 31, 2016 and 2015.
  • The Company repurchased approximately 455,000 shares of its Common Stock in the third quarter at an average cost of approximately $68 per share, and repurchased approximately 2.8 million shares at an average cost of approximately $65 per share in the year-to-date. At October 31, 2016, approximately $313 million remained available for repurchases under a program that authorizes the repurchase of up to $500 million of the Company’s Common Stock and that expires on January 31, 2019.
  • With respect to the impact of recent election-related activity near the Company’s New York Flagship store, management has noted some adverse effect on traffic in that store and a continuation of sales softness relative to prior year and to the Company’s other U.S. stores this year. That store represented less than 10% of worldwide net sales for the three and nine-month periods ended October 31, 2016, as well as for each quarter in fiscal 2015. The Company cannot provide any assurance that sales in that store will not be negatively affected by this activity in the fourth quarter or in any future period.

Outlook:

For the full 2016 fiscal year, management is maintaining its outlook to expect: (i) worldwide net sales declining by a low single-digit percentage from the prior year and (ii) earnings per diluted share declining by a mid-single-digit percentage from 2015’s adjusted earnings (which excluded loan impairment and certain staffing and occupancy charges – see “Non-GAAP Measures”). These expectations are approximations and are based on the Company’s plans and assumptions, including: (i) worldwide gross retail square footage increasing 3%, net through 11 store openings, 6 relocations and 6 closings; (ii) operating margin below the prior year (excluding the prior year’s charges – see “Non-GAAP Measures”) due to an anticipated increase in gross margin more than offset by SG&A expense growth; (iii) interest and other expenses, net unchanged from 2015; (iv) an effective income tax rate lower than the prior year; (v) the U.S. dollar unchanged at current spot rates versus other foreign currencies for the balance of the year; and (vi) weighted average diluted shares outstanding lower than in fiscal 2015.

Management also expects for the full 2016 fiscal year: (i) net cash provided by operating activities of at least $660 million and (ii) free cash flow (net cash provided by operating activities less capital expenditures – see “Non-GAAP Measures”) of at least $400 million. These expectations are approximations and are based on the Company’s plans and assumptions, including: (i) net inventories unchanged from the prior year, (ii) capital expenditures of $250 million and (iii) net earnings in line with management’s expectations as described above.

Today’s Conference Call:

The Company will conduct a conference call today at 8:30 a.m. (Eastern Time) to review actual results and the outlook. Please click on http://investor.tiffany.com (“Events and Presentations”).

Next Scheduled Announcements:

The Company expects to report its sales results for the two month holiday period ending December 31, 2016 on Tuesday January 17th before the market opens. To be notified of future announcements, please register at http://investor.tiffany.com (“E-Mail Alerts”).

Tiffany is the internationally-renowned jeweler founded in New York in 1837. Through its subsidiaries, Tiffany & Co. manufactures products and operates TIFFANY & CO. retail stores worldwide, and also engages in direct selling through Internet, catalog and business gift operations. For additional information, please visit www.tiffany.com or call our shareholder information line at 800-TIF-0110.

Forward-Looking Statements:

The historical trends and results reported in this document and on our third quarter earnings call should not be considered an indication of future performance. Further, statements contained in this document and made on such call that are not statements of historical fact, including those that refer to plans, assumptions and expectations for the current fiscal year and future periods, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, the statements under “Outlook” as well as statements that can be identified by the use of words such as ‘expects,’ ‘projects,’ ‘anticipates,’ ‘assumes,’ ‘forecasts,’ ‘plans,’ ‘believes,’ ‘intends,’ ‘estimates,’ ‘pursues,’ ‘continues,’ ‘outlook,’ ‘may,’ ‘will,’ ‘can,’ ‘should’ and variations of such words and similar expressions. Examples of forward-looking statements include, but are not limited to, statements we make regarding the Company’s plans, assumptions, expectations, beliefs and objectives with respect to store openings and closings; product introductions; sales; sales growth; sales trends; store traffic; retail prices; gross margin; operating margin; expenses; interest and other expenses, net; effective income tax rate; net earnings and net earnings per share; share count; inventories; capital expenditures; cash flow; liquidity; currency translation; growth opportunities; litigation outcomes and recovery related thereto; the collectability of amounts due under financing arrangements with diamond mining and exploration companies; and certain ongoing or planned product, marketing, retail, manufacturing, information systems development, upgrades and replacement, and other operational and strategic initiatives.

These forward-looking statements are based upon the current views and plans of management, speak only as of the date on which they are made and are subject to a number of risks and uncertainties, many of which are outside of our control. Actual results could therefore differ materially from the planned, assumed or expected results expressed in, or implied by, these forward-looking statements. While we cannot predict all of the factors that could form the basis of such differences, key factors include, but are not limited to: global macroeconomic and geopolitical developments; changes in interest and foreign currency rates; shifting tourism trends; regional instability, violence (including terrorist activities), election-related or other political activities or events, and weather conditions that may affect local and tourist consumer spending; changes in consumer confidence, preferences and shopping patterns, as well as our ability to accurately predict and timely respond to such changes; shifts in the Company’s product and geographic sales mix; variations in the cost and availability of diamonds, gemstones and precious metals; changes in our competitive landscape; disruptions impacting the Company’s business and operations; failure to successfully implement or make changes to the Company’s information systems; gains or losses in the trading value of the Company’s stock, which may impact the amount of stock repurchased; and our ability to successfully control costs and execute on, and achieve the expected benefits from, the operational and strategic initiatives referenced above. Developments relating to these and other factors may also warrant changes to the Company’s operating and strategic plans, including with respect to store openings, closings and renovations, capital expenditures, information systems development, inventory management, and continuing execution on, or timing of, the aforementioned initiatives. Such changes could also cause actual results to differ materially from the expected results expressed in, or implied by, the forward-looking statements.

Additional information about potential risks and uncertainties that could affect the Company’s business and financial results is included under “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2016 and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s most recent quarterly report on Form 10-Q. Readers of these documents should consider the risks, uncertainties and factors outlined above and in the Form 10-K in evaluating, and are cautioned not to place undue reliance on, the forward-looking statements contained herein. The Company undertakes no obligation to update or revise any forward-looking statements to reflect subsequent events or circumstances, except as required by applicable law or regulation.

Contact:

Mark L. Aaron
212-230-5301
mark.aaron@tiffany.com

Source: Tiffany & Co.

Tiffany & Co. announces the appointment of Mark Erceg as its next EVP and CFO

NEW YORK, 2016-Sep-15 — /EPR Retail News/ — Tiffany & Co. (NYSE:TIF) has appointed Mark Erceg to become its next executive vice president and chief financial officer, responsible for the Company’s worldwide financial, indirect procurement and information technology functions.

Mr. Erceg, 47, will be based in New York and will report to Frederic Cumenal, chief executive officer. His appointment will become effective on October 18, 2016. He replaces Tiffany’s former chief financial officer who left the Company in May to pursue a position at another company.

Previously, Mr. Erceg has been employed at Canadian Pacific Railway Limited, where he has served as executive vice president and chief financial officer since May 2015. From 2010 – 2015, he was the chief financial officer for Masonite International Corporation. He began his career at The Procter & Gamble Company in 1992 where, over 18 years, he served in positions of increasing responsibility in finance, market strategy, customer response, general management and global investor relations.

“Mark brings an operational process orientation and a broad financial, international and consumer brands background to Tiffany,” said Mr. Cumenal. “As the new leader of our multi-talented finance, procurement and information technology organizations, his varied experience and global perspective will be important as we continue to work toward strengthening Tiffany’s luxury brand position around the world and enhancing our profitability and productivity.”

Tiffany is the internationally-renowned jeweler founded in New York in 1837. Through its subsidiaries, Tiffany & Co. manufactures products and operates TIFFANY & CO. retail stores worldwide, and also engages in direct selling through Internet, catalog and business gift operations. For additional information, please visit www.tiffany.com or call our shareholder information line at 800-TIF-0110.

Forward-Looking Statements:

Statements contained in this document that are not statements of historical fact, including those that refer to plans, assumptions and expectations for brand position, profitability and productivity, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, statements that can be identified by the use of words such as ‘work toward,’ ‘strengthen,’ ‘enhance,’ ‘continue,’ ‘will,’ ‘expect,’ ‘anticipate,’ ‘believe,’ and variations of such words and similar expressions.

These forward-looking statements are based upon the current views and plans of management, speak only as of the date on which they are made and are subject to a number of risks and uncertainties, many of which are outside of our control. Actual results could therefore differ materially from the planned, assumed or expected results expressed in, or implied by, these forward-looking statements. While we cannot predict all of the factors that could form the basis of such differences, key factors include, but are not limited to: global macroeconomic and geopolitical developments; changes in interest and foreign currency rates; shifting tourism trends; regional instability, violence (including terrorist activities) and weather conditions that may affect local and tourist consumer spending; changes in consumer confidence, preferences and shopping patterns, as well our ability to accurately predict and timely respond to such changes; shifts in the Company’s product and geographic sales mix; variations in the cost and availability of diamonds, gemstones and precious metals; changes in our competitive landscape; disruptions impacting the Company’s business and operations; gains or losses in the trading value of the Company’s stock, which may impact the amount of stock repurchased; and our ability to successfully control costs and execute on, and achieve the expected benefits from, our operational and strategic initiatives. Developments relating to these and other factors may also warrant changes to the Company’s operating and strategic plans, including with respect to store openings, closings and renovations, capital expenditures, inventory management, and continuing execution on, or timing of, the aforementioned initiatives. Such changes could also cause actual results to differ materially from the expected results expressed in, or implied by, the forward-looking statements.

Additional information about potential risks and uncertainties that could affect the Company’s business and financial results is included under “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2016 and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s quarterly reports filed on Form 10-Q in 2016. Readers of these documents should consider the outlined risks, uncertainties and factors in evaluating, and are cautioned not to place undue reliance on, the forward-looking statements contained herein. The Company undertakes no obligation to update or revise any forward-looking statements to reflect subsequent events or circumstances, except as required by applicable law or regulation.

Contact:
Mark L. Aaron
212-230-5301
mark.aaron@tiffany.com

Source: Tiffany & Co.

Tiffany & Co. to host Investor Day on Tuesday April 12, 2016 at its corporate office in New York City

NEW YORK, 2016-Apr-05 — /EPR Retail News/ — Tiffany & Co. (NYSE: TIF) will be hosting an Investor Day on Tuesday April 12, 2016 at its corporate office in New York City. The meeting will be led by Frederic Cumenal, chief executive officer, during which members of the executive management team will provide overviews of their areas of responsibility, strategic direction and initiatives designed to generate sales and earnings growth. Presentations will begin at approximately9:30 a.m. ET and, following a question and answer session, the event is expected to conclude no later than 12:30 p.m.

As seating at the event is limited, presentations will also be webcast (audio and slides) live at http://investor.tiffany.com/. A replay will be available at that site for 90 days following the event.

Tiffany is the internationally-renowned jeweler founded in New York in 1837. Through its subsidiaries, Tiffany & Co. manufactures products and operates TIFFANY & CO. retail stores worldwide, and also engages in direct selling through Internet, catalog and business gift operations. For additional information, please visit www.tiffany.com or call our shareholder information line at 800-TIF-0110.

Tiffany & Co.
Mark L. Aaron, 212-230-5301
mark.aaron@tiffany.com

Source: Tiffany & Co.

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