Tiffany To Cut Jobs As Sales Fail To Sparkle

The luxury jeweller, Tiffany & Co (NYSE: TIF - news) , has announced plans to cut staff and store numbers following a steep decline in sales over the Christmas season.

It (Other OTC: ITGL - news) reported a 9% fall in like-for-like sales worldwide compared with the same period last year and its share price - down more than a quarter over the past year - fell 6% in early trading in response to the trading update.

Each region, except Japan where Tiffany results were reported separately, endured a drop in sales - with the largest in its Asia-Pacific operations.

Tiffany, which has 290 outlets globally, said business in that region - which includes China - fell 14% while Europe and the Americas each saw sales decline by 10%.

Chief executive, Frederic Cumenal, said: "In the holiday period, we continued to feel pressure from the strong US dollar on the translation of non-US sales into dollars and on foreign tourist spending in the US, which we expect will continue into 2016.

"We believe overall sales results were negatively affected by restrained consumer spending tied to challenging and uncertain global economic conditions and we expect 2015 earnings to come in at the low end of our previously-set range of expectations."

The company said it had taken a particular hit from falling consumer spending in core tourist markets, such as New York.

The slowdown in the global economy has been largely due to weakness in emerging markets, particularly China .

While it gave no information on the numbers of staff or stores to be affected by cutbacks, Tiffany said it would book a charge to account for it in the current fourth quarter.

Neil Saunders, chief executive of the retail research agency Conlumino, said: "If Tiffany was hoping for some holiday respite following a year of negative numbers, it will be sorely disappointed by these results.

"Indeed, the pace of decline has actually accelerated since the third quarter, which covered the three months up until the end of October. Given the significant opportunity that the holiday season affords this is a worrying outcome."