Operator: Good day, and welcome to the Tiffany & Company Fourth Quarter Conference Call. Today's call is being recorded.
Participating on today's call are Mr. Mike Kowalski, Tiffany's Chairman and CEO; Mr. Pat McGuiness, Tiffany's Chief Financial Officer; and Mr. Mark Aaron, Tiffany's Vice President of Investor Relations and.
At this time, I'd like to turn the conference over to Mr. Aaron. Please go ahead.
Mark L. Aaron - VP, IR: Thank you and welcome to this conference call. We issued our financial results earlier today and hope that by now you've had an opportunity to review the news release. On today's call Mike, Pat and I will provide our insights into the fourth quarter and full year results and comment on Tiffany's plans and outlook for the coming year.
Before continuing, please note Tiffany's Safe Harbor provision that statements made on this call that are not historical facts are forward-looking statements. Actual results might differ materially from the expectations projected in those forward-looking statements.
Additional information concerning risk factors that could cause actual results to differ materially is set forth in Tiffany's Form 10-K, 10-Q and 8-K reports filed with the Securities and Exchange Commission. The Company undertakes no obligation to update or revise any forward-looking statements to reflect subsequent events or circumstances.
Now, we can proceed with a multi-faceted review of Tiffany's performance. Taking a big picture view, Tiffany's financial results in 2012 did not achieve the expectations we had established at the start of the year. Net sales rose 4% due to single-digit percentage growth in all regions, although below initial expectations in the Americas and Asia Pacific and gross margin continue to be pressured by product input costs and unfavorable sales mix. SG&A expense growth was contained, but in total, net earnings per diluted share of $3.25 was 4% below 2011 on a GAAP basis and declined 10% when excluding non-recurring items in 2011.
The conclusion to the year with 4% sales growth and only a slight earnings increase in the fourth quarter, results is certainly not up to our normal performance standards.
Let's first look at sales by region. In the Americas sales in fourth quarter rose 2%, which was consistent with the increase we had reported for the November-December holiday season and reflected jewelry units equal to the prior year and a slight increase in the average price per unit sold.
For the full year, total Americas sales also rose 2%, on top of the 15% increase in 2011, as an increase in the average price per units sold was partly offset by a decline in jewelry units sold, primarily in silver jewelry. The Americas region accounted for 48% of worldwide sales in 2012 versus 50% in 2011.
On a constant exchange rate basis, total sales rose 2% in both the quarter and year, while comparable store sales declined 2% in both the quarter and year. Geographically sales in the New York flagship store declined 3% in the fourth quarter, while a 3% decline in the year went up against a 20% increase in 2011.