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Tiffany Reports Second Quarter Results

New York, N.Y., August 27, 2015 - Tiffany & Co. (NYSE: TIF) today reported its financial results for the three months ("second quarter") ended July 31, 2015. Worldwide net sales rose 7% on a constant-exchange-rate basis (see "Non-GAAP Measures" schedule); as reported, sales were approximately equal to the prior year due to the negative effect from the strength of the U.S. dollar. A decline of 16% in net earnings, as reported, included an impairment charge related to a loan to a diamond mining company; excluding the charge, net earnings declined 10% (see "Non-GAAP Measures" schedule), in line with management's expectation. Management now expects net earnings for the year ending January 31, 2016 to be 2%-5% below last year's $4.20 per diluted share (excluding charges in both years).

In the second quarter:

In the six months ("first half") ended July 31:

Frederic Cumenal, chief executive officer, said, "We entered this year expecting translation and tourism-related pressures on sales and earnings from the exceptionally strong U.S. dollar, as well as challenging economic conditions in certain markets. While the adverse effects from the strong dollar have been even more significant than initially expected, we met our overall expectations in the first half of the year. We are pleased with responses to new designs, including our Tiffany T jewelry and CT60™ watch collections, and are excited about upcoming additions being made to bolster sales across jewelry categories and price points. Tiffany also expanded its global presence during the quarter by opening six stores across the Americas, Asia-Pacific and Europe."

Net sales highlights by region were as follows:

Other financial highlights:

Mr. Cumenal added, "In light of the difficult environment exacerbated by the strong dollar and ongoing external uncertainties, we are tempering our full year earnings forecast. However, we remain focused on pursuing longer-term growth opportunities that strengthen Tiffany's position among the world's important luxury brands."

Full Year Outlook:

For the year ending January 31, 2016, Management now expects net earnings to be 2%-5% below last year's $4.20 per diluted share (excluding the loan impairment charge in the second quarter of 2015 and a debt extinguishment charge in 2014). This forecast assumes no growth in net earnings in the third quarter (excluding the debt extinguishment charge referenced above in the prior year's quarter) and a resumption of growth in the fourth quarter. Also for the full year, this forecast does not assume recording any further similar loan impairment charges; this forecast does continue to assume inventories increasing at a rate below sales growth; capital expenditures of $260 million; and free cash flow in excess of $400 million. All assumptions are approximate and may or may not prove valid.

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 ("Events and Presentations").

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 or call our shareholder information line at 800-TIF-0110.

Next Scheduled Announcement:

The Company expects to report its third quarter results on November 24, 2015. To be notified of future announcements, please register at ("E-Mail Alerts").

Forward-Looking Statements:

The statements in this document that refer to plans and expectations for the current fiscal year and future periods are forward-looking statements that involve a number of risks and uncertainties. Words such as 'expects,' 'anticipates,' 'forecasts,' 'plans,' 'believes,' 'continues,' 'may,' 'will,' and variations of such words and similar expressions are intended to identify such forward-looking statements. Examples of forward-looking statements include, but are not limited to, statements we make regarding the Company's objectives, expectations and beliefs with respect to store openings and closings, product introductions, sales, sales growth, retail prices, gross margin, expenses, operating margin, effective income tax rate, net earnings and net earnings per share, inventories, capital expenditures, cash flow, liquidity, currency translation and growth opportunities. These forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond the Company's control, which could cause the Company's actual results to differ materially from those indicated in these forward-looking statements. Such factors include, but are not limited to, risks from global economic conditions, decreases in consumer confidence, the Company's significant operations outside of the United States, regional instability and conflict that could disrupt tourist travel and local consumer spending, weakening foreign currencies, changes in the Company's product or geographic sales mix and changes in costs or reduced supply availability of diamonds and precious metals. Please also see the Company's risk factors, as they may be amended from time to time, set forth in the Company's filings with the Securities and Exchange Commission, including the Company's most recently filed Annual Report on Form 10-K, for a discussion of these and other factors that could cause actual results to differ materially. 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.

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The Company reports information in accordance with U.S. Generally Accepted Accounting Principles ("GAAP"). 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. The Company presents such non-GAAP financial measures in reporting its financial results to provide investors with an additional tool to evaluate the Company's operating results.

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"). Management believes this constant-exchange-rate basis provides a more representative assessment of sales performance and provides better comparability between reporting periods. The following table reconciles the sales percentage increases (decreases) from the GAAP to the non-GAAP basis versus the previous year:

Net Earnings

The accompanying press release presents net earnings and highlights expenses tied to certain items in the text. Management believes excluding such items presents the Company's results on a more comparable basis to the corresponding period in the prior year, thereby providing investors with an additional perspective to analyze the results of operations of the Company at July 31, 2015. The following tables reconcile certain GAAP amounts to non-GAAP amounts:

Mark L. Aaron

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