Pandora sales and profits soar despite currency headwinds

By

Sandra Halliday

Published
Nov 1, 2016

Danish jeweller Pandora is planning to open more stores following a third quarter in which its net profits surged by 40% as it saw strong growth in Southern Europe and the Asia-Pacific region.

In the three months to the end of September, net profits reached DKK1.41bn, up from DKK1.01bn a year ago and much better than analysts’ already-lofty expectations.

Revenue growth was also strong as sales across its 9,000 stores rose 18% to DKK4.61bn. Operating margin was up to 37.3% from 34.2%, aided by lower commodity prices, said the firm.

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The figures came after a strong first half with positive momentum continuing into Q3, CEO Anders Colding Friis said.

The company now expects revenue for the full year to pass the DKK20bn mark, but potential growth will be hurt by currency exchange effects, now expected to dent the firm’s revenue growth figure by 4%, rather than the 3% signalled earlier.

The impact of currencies on European sales in particular is clear from the Q3 figures with the EMEA region seeing sales up 18% currency-neutral but up 25% in local currencies. Asia-Pacific sales rose 46% currency-neutral and 47% in local currencies, while Americas sales rose 6% on both measures.

But even with the currency headwinds, the firm is expanding fast and Pandora is planning to open 325 new stores for the year as a whole, up from its previously flagged number of 300.

Around 50% of the stores will be in the EMEA region with the rest divided equally between the Americas and Asia-Pacific.