PANDORA Posts Strong Q3 Despite Tough US Market, Maintains Guidance
Danish jewellery brand PANDORA reported that its third quarter revenue grew 13 percent to DKK 5.19 billion ($809 million), driven mainly by a strong 26 percent increase in the Asia-Pacific region — mainly Australia and China — and a solid 15 percent growth in the Europe, Middle East and Africa (EMEA) markets.
The US market continues to be challenging, registering just a single percent in growth (6 percent in local currency). Currency headwinds are expected to have an impact of 2 percentage points for the whole year, while the fallout from the hurricanes that hit the US are expected to have a negative impact of DKK 150 million ($23.4 million).
As a result, PANDORA says its full-year guidance, though remaining unchanged at DKK 23-24 billion ($3.6-$3.7 billion), is likely to be in the lower part of the range.
Commenting on the results, company CEO Anders Colding Friis said, “The results in the third quarter were in-line with our expectations, with the underlying development showing positives as well as negatives. Most of our major growth markets — Germany, Italy, Australia and China — continued to show strong performance with double-digit growth rates, whereas the retail environment in the US, combined with currency headwind from the US dollar, continued to be a challenge.”
PANDORA plans to continue to expand its store network and expects to add more than 300 new concept stores in 2017 of which roughly 50 percent are expected to be opened in the EMEA region, 25 percent in the Americas and 25 percent in the Asia Pacific region.
PANDORA expects around half of the concept store openings to be company-owned stores, which is in line with the its intention to increase its owned and operated retail footprint. Roughly 25 percent of the new stores are expected to be opened by franchisees and 25 percent by third-party distributors.
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