New York  - Tiffany & Co, the world's second-largest retailer of luxury jewelry, on Monday reported lower fourth-quarter profits that beat analysts' expectations, sending its shares up 15 per cent.

To deal with lower sales in these tough economic times, the company said that it cut costs and jobs, but did not cut prices.

Net income dropped 76 per cent to 31.1 million dollars, while revenue fell 20 per cent to 841.2 million dollars in the three months ended January 31.

The company said there were no signs of a turnaround and forecast lower sales for 2009 by at least 11 per cent.

Tiffany said its US sales, in stores open at least a year, contracted by a third. Business was generally slow as even wealthy shoppers stopped spending on luxury goods amid the widening recession.

Tiffany has 206 stores and boutiques, including 76 in the US, and is heavily dependent on its US market - particularly at its headquarters in New York. (dpa)