Bucharest, Romania – Jeweller Tiffany has seen worldwide sales fall by 3% to $1billion in the first quarter, as it was hit by lower-spending tourists.
Meanwhile like-for-like sales at the New York-based firm fell by 5%.
The company also said it could hit by tariff increases on its U.S. exports to China, as part of a trade war.
The firm said it would now look to invest in domestic markets worldwide, with a focus on the local Chinese market.
Sales in the Americas fell 4% largely due to lower spending by foreign tourists.
‘The Chinese government is pushing for local consumption and we will keep on focusing on our marketing in China because there is a very strong demand there”, chief Executive Alessandro Bogliolo told Reuters.
The U.S. has more than doubled tariffs on $200 billion of Chinese goods escalating a trade war between them.
Tiffany said it was braced for “tariffs increasing on jewellery, that the company exports from U.S. to China, from its current levels to a new level of 25% on average”.
Meanwhile, net earnings of $125m were 12% lower than the previous year’s $142m.
Mr. Bogliolo said in a conference call that external pressures had had a “significant impact on sales”.
“For example, we believe that the strong dollar had a meaningful impact on first quarter retail sales accredited to foreign tourists in the Americas”, he said.
“Our internal estimates indicate that those tourists sales represent a low double digit percentage of our American retail sales. Those sales were down approximately 25% from a year ago with sharper declines among Chinese tourists”
But he said he was pleased by the growth of global sales attributed to local customers and growth in mainland China.
“We are continuing our exciting development in mainland China this year and total sales continue to grow by a double-digit rate in local currency in the first quarter”, he said.