Jan 7, 2016
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Denmark's Pandora plans 200-300 new stores a year from 2016-2018

Jan 7, 2016

Danish jewellery maker and retailer Pandora said on Thursday it plans to add between 200 and 300 stores a year between 2016 and 2018 after sales jumped by 40 percent in 2015.

Pandora said preliminary calculations showed revenue of 16.7 billion Danish crowns ($2.42 billion) in 2015, a touch higher than the average of analysts' expectations of 16.18 billion, Thomson Reuters data showed.

Pandora opened 375 stores in 2015 and now has 1,600 stores globally.

Pandora's shares rose following the news. By 0812 GMT, the shares were up 3.7 percent while the main Copenhagen index was down 1.6 percent.

"As Pandora continues to expect an EBITDA margin (earnings before interest, taxes, depreciation and amortisation) of around 37 percent, we see today's announcement as a positive trigger," Nordea Markets wrote in a note to clients.

"The 200-300 store openings will be a major driver of prosperity." analyst Michael Friis Jorgensen from Alm. Brand Markets said.

In coming years around 60 percent of the new stores will be opened in Europe, 20 percent in the Americas and 20 percent in the Asia-Pacific region, the company said in a statement before its capital markets day in Thailand, where its products are made.

By investing around 1.8 billion crowns from 2015-2019, the company expects to double the current production capacity of its factories in Thailand.

Nordea Markets see the company's manufacturing facilities in Thailand as a key competitive advantage for Pandora as they enable it to produce jewellery very cost efficiently.

"Furthermore, the company has gradually built up a skilled labour force in Thailand," Nordea wrote.

Pandora competes with companies such as Signet Jewelers and to some extent with Tiffany & Co.

Pandora employs more than 15,000 people worldwide, some 10,400 of them in Gemopolis, Thailand.

$1 = 6.8970 Danish crowns


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