(Refiles to clarify in first bullet and paragraph 5 that it is ending Europe-based sales etc)
* To end Europe-based sales & trading, research, broking
* Firm says consulting London staff on job losses
* Q3 EPS $0.36 beats Street by 11 cents
* Revenue falls 3 percent to $116.5 million
(Recasts, adds spokeswoman's comment, more on job cuts)
By Paul Sandle and Anand Basu
LONDON/BANGALORE, Oct 20 (Reuters) - U.S. investment bank and securities company Piper Jaffray Cos Inc said it would drastically scale back its London operations in response to challenging economic and market conditions in Europe.
The move will see the departure of analysts covering healthcare, technology and other sectors, marking a further reduction of research into smaller companies.
The announcement came as the firm posted lower but still better than expected third-quarter profit on Wednesday, helped in part by strong revenues from its advisory services and municipal financing.
The company employs 75 people in London and a spokeswoman said it had started consultations with staff. "The impact to employee headcount will be significant," she said, declining to give further details.
Piper will cease Europe-based sales and trading, underwriting, corporate broking and research of European companies.
Piper Jaffray -- well-known for its research in the healthcare, technology and consumer sectors -- said it expected to incur a restructuring charge of between $8.3 million and $9.8 million, the majority of which will be recorded in the fourth quarter.
"We expect the improvement in our business will also be slower than anticipated but we are committed to improving our profitability and achieving a competitive return on equity," Chief Executive Andrew Duff said in a statement.
For the quarter, the company reported a net income of $7.1 million, or 36 cents a share, compared with $9.3 million, or 47 cents a share, a year ago. Revenue fell 3 percent to $116.5 million.
Analysts on average had expected earnings of 27 cents a share, on revenue of $112.9 million, according to Thomson Reuters I/B/E/S.
Shares in the company were 3.5 percent higher at $30.79 in early trade after closing down 3 percent at $29.73 in New York on Tuesday. (Additional reporting by Ben Hirschler; Editing by Greg Mahlich and Andrew Callus)