Tiffany blames Trump protests for Christmas sales lacking sparkle

Tiffany & Co (NYSE: TIF - news) has blamed a sharp fall in New York sales on Donald Trump.

The upmarket US jeweller said sales at its flagship store on Manhattan's Fifth Avenue fell 14% over the crucial festive season covering November and December.

It cited "post-election traffic disruptions" - widely interpreted as a reference to angry protests and high security next door, outside Trump Tower, where the President-elect has been living and will continue to reside until Friday's inauguration.

Some analysts, however, have suggested the upmarket chain should have benefited from the extra numbers on the street outside and pointed to wider challenges for Tiffany.

It reported that overall sales in the Americas region fell 4% over the two months but worldwide sales of $966m (£784m) were slightly up on the same period last year.

Chief (Taiwan OTC: 3345.TWO - news) executive Frederic Cumenal told investors: "These overall holiday period sales results were somewhat lower than we had anticipated, but we continue to benefit from a favourable gross margin and prudent expense management.

"Although we do not anticipate any significant improvement in 2017 to the macroeconomic challenges that we faced this year, we continue to focus on our initiatives to enhance our stores and our customers' experience, and to add newness to our product assortment, while maintaining effective marketing communications and a well-developed supply chain."

Shares (Berlin: DI6.BE - news) in the company, which has a market value of $10bn (£8bn), closed 2.5% lower in New York on Thursday.

Neil Saunders, chief executive of analytical specialists Conlumino, said of the performance: "The election related disruption at the flagship store on Fifth Avenue is certainly responsible for some of the overall slip and for the terrible results coming out of that branch, but without that chaos would sales have been positive?

"Our view is they would not have been, neither at overall level nor for the Fifth Avenue shop; they would only have been slightly less negative.

"This underlines the fact that Tiffany still suffering from wider problems - problems that have been in play for some time. These include weaker tourist traffic and spending thanks to the strong dollar and, more importantly, a loss of interest in the brand from some American consumers.

"Unlike the challenges on Fifth Avenue, these things will not dissipate any time soon and present an ongoing challenge to Tiffany as it tries to reinvigorate its brand image, especially among younger shoppers."

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