Tiffany is out. At least from the Deutsche Boerse World Luxury Index.

After conducting its annual review, the German Stock Exchange is bringing Italian fashion group Valentino and Asian hotels group Shangri-La Asia into the index come Monday, to round out the 20 luxury companies on it. And out go U.S. luxury jeweler Tiffany and high-end sound equipment maker Harman International.

But the jeweler doesn’t seem too ruffled by the news. Now, of course the S&P 500 is pretty darn important to them, a spokesman said. But this index? Well let’s just say it is not of paramount concern. We hear several investors and consumers hardly use this index, which was launched earlier this year and includes the likes of Christian Dior, Burberry, Porsche and Hermes, in making investment or purchase decisions.

But wait. Tiffany could still grab its cushy lux seat back — private equity group Permira just bought a 97 percent stake in Valentino and intends to buy out the remaining little. If and when the Italian fashion house goes private, Tiffany is back in.

So, all’s still sparkling for the New York jeweler.

The general state of the American consumer? Worried.

Worried about subprime issues, worried about rising gas prices, most definitely worried about losing their jobs and worried about that swinging stock market.

About 27 percent of about 1,000 Americans surveyed in September thought their current financial situation was weak, according to the RBC CASH Index. Only 23 percent had thought so in August.

The monthly national survey tracks consumer attitudes and spending by household. About 30 percent of those surveyed were between 18 and 34 years of age, 26 percent were between 35-49, 27 percent between 50-64 and the rest were older.

More consumers were uneasy making household purchases, and more were squeamish this month about job security — 45 percent said they were less confident about keeping their jobs, up from 40 percent last month.

The doom-and-gloom didn’t stop there.

Only 49 percent of consumers thought it was unlikely that somebody they knew would find themselves without a job in the next six months. Last month, that number was 56 percent.

More thought their local economies were weak, and felt less assured making investments or whopper buys.

“The magnitude in the drop of consumer confidence is not surprising given the rocky economic ride consumers are experiencing,” said T.J. Marta, economic and fixed income strategist for RBC Capital Markets.

But all those funky sentiments had a bright spot to them.

More than one-third of those surveyed thought their financial situation will improve in the next six months, according to the survey.

Smells like optimism.

(Photo source: Reuters)

Another top U.S. retail executive confirmed on Monday that the stock market see-saw does not appear to be throwing off the high-rollers.

“I see the prestige market intact. I don’t see the slowdown,” said Coty Inc. Chief Executive Bernd Beetz in an interview with Reuters. “Right now, I cannot complain about the market.”

Luxury buyers seem to have sailed through sharply higher gas prices, a housing market slowdown and the recent worry about tightening credit markets. 

But you’ve read all about that already.

For Coty, though — with brands backed by A-list celebrities like Calvin Klein, Sarah Jessica Parker and Jennifer “J-Lo” Lopez – there’s no slowdown as of now, Beetz said on Monday.

His comments come after handbag company Coach Inc’s Chief Executive, Lew Frankfort, said last week that he wasn’t seeing the luxury customer applying the brakes. Neither did the CEOs at Saks or Blue Nile, about two months ago.  In fact, during the past quarter, one customer bought a single jewelry item worth for more than $1.5 million from online diamond retailer Blue Nile. 

What credit market crunch? Gas costs how much?

Diversity is Jarden’s best friend. 
 
Last year, when almost every retailer in sight was bemoaning a startlingly warm winter, folks at Rye, New York-based Jarden Corp., which sells everything from camping gear and coffee makers to playing cards and plastic spoons, sat back while consumers bought kitchen appliances and outdoor products like camping gear.

Then, as the weather flipped an turned freezing in February, it sold fire logs and electric blankets, while retailers with spring products in stores threw up their hands in despair. 

The company is still touting its diverse product portfolio for its success. This quarter, the company’s earnings were boosted by sales in its outdoor products segment, mainly due to the acquisition of fishing tackle company Pure Fishing.

Going forward? It says consumer solutions products like Seal-a-Meal food storage bags and Oster kitchen appliances will top its sales list. 

The company recently bought sporting goods company K2 and Pure Fishing. Now it’s looking for more companies to add to its growing portfolio.  

And thanks to an already existing commitment with Lehman Brothers for financing, it won’t have to doubt if a potential deal will come through smoothly, company Chief Financial Officer Ian Ashken said on a conference call with analysts. 

“In terms of the financing, I don’t think I’m telling anybody on this call anything they don’t know; the financing markets in the last two weeks have been very difficult,” Ashken said. “We have a commitment from Lehman Brothers to do our financing. So, obviously, as we get closer to closing, the variable is going to be how much it is going to cost, not whether we’re going to be able to do it. It is just one of those things. Markets go up, markets go down.”

(Photo from company Web site)

   With Sally Beauty Holdings Inc., there is a chance history might repeat itself.

First came Procter & Gamble – when it announced an expanded agreement with the beauty retailer’s Beauty Systems Group (BSG) earlier this year after pulling their Wella line of hair care products from BSG stores in 2004.

Now, Farouk Systems Group — known for its Biosilk line of products — may be making its way back from L’Oreal’s Beauty Alliance stores, and back into Sally’s BSG unit for distribution, according to a note by Bear Stearns analyst Justin Hott.

Previously, while announcing its second-quarter results on the heels of losing L’Oreal distribution rights, Sally said Farouk had terminated its distribution agreement with BSG. Farouk product sales in the first half of fiscal 2007 accounted for about 3 percent of BSG’s total revenue in that period, Sally said at that time.

Farouk may have turned to L’Oreal hoping for better execution, or perhaps a sale of the company. But L’Oreal recently added California-based hair care company PureOlogy to its portfolio — perhaps leaving Farouk an unlikely candidate for purchase, Hott wrote.

“This potential return could be a positive sign that the loss of top lines such as L’Oreal’s brands will stop weighing down SBH shares,” he said, adding it may make more sense for brands like Farouk to be at BSG.

Farouk’s possible return to Sally might not mean much to earnings right away, but it would reinforce the view that BSG could live without L’Oreal, Hott wrote.

It could also indicate that other brands could follow.

“We also have more confidence that other brands could follow,  such as the Paul Mitchell brand out West, which could add $0.02-$0.05 to annual EPS,” he wrote.

(Photo: from Sally Beauty Web site)

Macy’s Inc. shares hit a high on Wednesday morning after a news report in Women’s Wear Daily that private equity firm Kohlberg Kravis Roberts & Co. is considering a bid for the department store chain.
  Any potential transaction could signal a setback for beauty company Estee Lauder, whose North American department store sales — led by Macy’s stores — account for about 37 percent of revenue, according to Bear Stearns analyst Justin Hott. For the full note, click here.
   Only recently did Estee’s Group President John Demsey say that the company was finally seeing U.S. sales normalizing a year after they started slumping following the Macy’s/May Department Stores consolidation and store closures.
   Though the flip side might be that a turnaround in Macy’s — which itself has reported flagging same-store sales lately — could be good for Estee Lauder under any circumstances, any reexamination of Macy’s business holds many risks of moving in other directions that are detrimental to Estee Lauder, Hott added.
   “Another potential disruption at Estee’s largest partner creates much more uncertainty and volatility,” Hott wrote in a research note. “We do not know if management would change, but there could be entirely new protocols, systems, and methods put in place under new ownership. Changes that take time to implement could slow the timetable for any turnaround by Estee.”
   Estee is trying to convince retailers to join it in spending more on training sales people at beauty counters, in an effort to revive sales. But buyers with a good deal of private equity experience are more likely to choose cutting costs over raising them, Hott wrote.

(Photo. Reuters file)