11 September 2008

Harry Winston Profit Soars

Harry Winston Diamond Corp. said second-quarter net income more than doubled as the company banked on strong growth in emerging markets.

"Our businesses in Asia, Europe and the Middle East have been sufficient to offset the general market softness in the U.S. and Japan; this contributed to our strong retail finish for second quarter," President Thomas J. O'Neill said, adding that the company was on "firm footing" for the second half of the year.

The comments echoed those of fellow jeweler Tiffany & Co., which in late July said strong sales in the Asian-Pacific and European regions offset weakness in the U.S.

The diamond miner and retailer reported net income of $49.9 million, or 81 cents a share, compared with $20.1 million, or 34 cents a share, a year earlier. The latest quarter was helped by a $4.3 million insurance recovery and a drop in the effective income-tax rate to 33% from 47%. The gross margin widened to 60.5% from 52.8%, helped by the insurance recovery.

Sales rose 7.4% to $186.1 million in the quarter ended July 31. Mining sales remained at $105 million as higher prices made up for lower volume.

Wall Street Journal; September 10, 2008

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