Tiffany & Co reported a 3% drop in worldwide net sales to $ 4 billion for the full fiscal year ended January 31, 2017, even as sales in the 4th quarter rose 1%. There was a 5% decline in comparable store sales. The annual figures were consistent with its previously issued guidance, the Company said, adding that performance was generally soft across all jewelry categories.

On a constant-exchange-rate basis, worldwide net sales and comparable store sales for the full year declined 3% and 5%, respectively, Tiffany reported. Net earnings were $446 million, or $3.55 per diluted share, compared with the prior year's $464 million, or $3.59 per diluted share.

Higher gross margins countered growth in operating expenses, the Company said. Net earnings per diluted share declined 1% in the full year and 2% in the fourth quarter. The Company generated more than $700 million of cash flow from operating activities in the full year.

While the Company’s performance in Japan was relatively stronger, most other regions reported declines. In the Americas, total sales declined 5% to $1.8 billion in the full year and comparable store sales declined 6%. This was due to lower spending by U.S. customers and foreign tourists. In addition, sales in Tiffany's New York flagship store declined 11% in the full year, and represented less than 10% of worldwide net sales.

In the Asia-Pacific region, total sales of $1 billion in the full year were approximately equal to the prior year with increased purchasing by local customers and declines in spending by foreign tourists. In addition, there was strong retail sales growth in China, increased wholesale sales in Korea, a decelerating rate of retail sales decline in Hong Kong and varying performance in other countries.

In Japan, sales were up 12% to $604 million in the full year and comparable store sales increased 16%, while wholesale sales declined in both periods. There was higher spending by local customers, with declines in spending by Chinese tourists.

In Europe, total sales of $458 million in the full year were 10% below the prior year and comparable store sales declined 14%. There was lower spending by local customers and foreign tourists across continental Europe, while UK witnessed constant-exchange-rate sales growth largely on account of higher foreign tourist spending in the second half of the year.

Other sales of $99 million in the full year were 8% below the prior year. Comparable store sales declined 15% in the full year due to lower retail sales in the UAE. Wholesale sales of diamonds increased in the full year.

Tiffany opened 11 Company-operated stores in the full year and closed five locations, which, coupled with relocations of five stores, resulted in a net increase in gross retail square footage of approximately 3%. At January 31, 2017, 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 307 stores a year ago (124 in the Americas, 81 in Asia-Pacific, 56 in Japan, 41 in Europe, and five in the UAE).

Michael J. Kowalski, Chairman of the Board and Interim Chief Executive Officer, said, "Despite macroeconomic and geopolitical challenges in the past year that we believe will continue in 2017, we strongly believe that Tiffany's strategies are sound and that we have meaningful growth opportunities. Our management team is focused on accelerating the execution of our strategies to deliver extraordinary products, communications and experiences that will delight our customers around the world. Through strong leadership and this accelerated execution, we believe we are well-positioned to deliver attractive total shareholder return over the long-term."

For the fiscal year ending January 31, 2018 the management expects worldwide net sales to increase by a low-single-digit percentage and by a mid-single-digit percentage on a constant-exchange-rate basis.