Financials

Pandora Posts Strong Q1 But Warns of US Slowdown Ahead

FinancialsMay 04, 2022

Pandora Posts Strong Q1 But Warns of US Slowdown Ahead

The company said the “affordable” jewelry market in the U.S. is growing slower than the overall market.

Pandora posted double-digit revenue growth in its first quarter but remains cautious about the year ahead in light of the war in Ukraine, COVID-19, inflation, and higher interest rates.
Copenhagen, Denmark—Pandora posted strong first-quarter results and raised its sales guidance for the year ahead.

Still, the company remains cautious about its fiscal future, noting the war in Ukraine, COVID-19, inflation, and higher interest rates could all negatively impact consumer demand.

“We are very pleased with the strong start to the year delivering record revenue for a first quarter,” said CEO Alexander Lacik. “All of our product platforms support the growth in Q1, as our ability to continuously offer new innovation pays off.”

Here are five key takeaways from the Danish jewelry company’s quarterly results.

Pandora’s quarterly revenue climbed double-digits.

First-quarter revenue was up 26 percent year-over-year to 5.7 billion Danish kroner ($805.4 million) compared with 4.5 billion Danish kroner ($637.1 million) in the first quarter last year.

It reported organic sales growth of 21 percent year-over-year.

Its sell-out growth (sales in Pandora-owned and -operated stores) was 17 percent year-over-year.

The company had a strong Valentine’s Day, with sales up about 30 percent year-over-year.

By sales channel, Pandora-owned retail stores, including the online store, brought in 3.9 billion Danish kroner ($555.7 million) in the first quarter, up 33 percent from the previous year.

Wholesale sales in the first quarter were up 15 percent to 1.6 billion Danish kroner ($221.8 million).

Pandora said its online sales performed well compared with 2019 levels, but were down compared with the previous first quarter, when COVID-19 lockdowns were in place.

Online organic growth was around 155 percent compared with the first quarter of 2019 and was the main contributor of growth from a channel perspective compared with 2019, said Pandora.

Given its strong first quarter, Pandora has upped its fiscal guidance for the year ahead.

It now expects organic revenue growth of 4 to 6 percent, up from its prior guidance of 3 to 6 percent. Its EBIT margin of 25 to 25.5 percent remains unchanged.

The U.S. market remains strong, but Pandora predicts a slowdown ahead.

In the United States, Pandora’s largest market accounting for 29 percent of total revenue, sales were up 19 percent in the first quarter.

Quarterly revenue in the U.S. totaled 1.7 billion Danish kroner ($233.6 million), up 19 percent year-over-year.

The U.S. market saw organic growth of 62 percent compared with Q1 2019 and has performed in line with Pandora’s expectations, the company said.

The Marvel collection did especially well in the U.S.

However, Pandora said it expects to see a “slowdown” in the U.S. market in 2022, noting the stimulus checks distributed in March 2021 boosted sales, making for tough year-over-year comparisons in Q2 2022. 

“Data indicates that the overall U.S. jewelry market has grown 11 to 18 percent in Q1 2022 and thereby above Pandora US. However, data also suggest that the affordable jewelry market has been growing much slower than the overall jewelry market,” said Pandora.

 Related stories will be right here … 

Pandora has been growing its footprint in North America.

In January, Ben Bridge Jeweler announced it was returning 37 Pandora stores, including 32 in the U.S. and 5 in Canada, to Pandora, looking to concentrate on its core business.

Pandora’s presence has grown especially strong on the West Coast, as 20 of the acquired Ben Bridge stores are located in California.

The acquisition is expected to give Pandora 170 million Danish kroner ($24.1 million) in incremental revenue for the full year, converting wholesale revenue to retail revenue.

The company also announced plans in February to open 28 shop-in-shops in Macy’s as it looks to increase its U.S. market share.

“The long-term aim is to double the U.S. business vs. 2019 and 62 percent organic growth vs. 2019 this quarter is an encouraging path toward this goal,” said Pandora.

“Pandora Me” and Marvel collections were top performers.

Pandora broke down its sales into “global business units,” or collections.

The “Pandora Me” collection saw revenue more than double, up 144 percent for the quarter.

Revenue from its “Collabs” collection, meaning collaborations, climbed 54 percent.

The company launched a Marvel collection in February, drawing jewelry inspiration from Avengers characters like Iron Man, Black Panther, The Hulk, and Captain America.

“The Marvel collaboration is building on Pandora’s strong relationship with Disney and proved an imminent success in the quarter. Marvel alone accounted for 3 percent share of business and has so far been outperforming the initial launch of both Star Wars and Harry Potter,” said Pandora.

Sales of the “Pandora Moments” collection grew 26 percent.

The “Pandora Brilliance” collection, which includes its lab-grown diamond jewelry, saw sales up 9 percent.

It was tested in the U.K to a positive reception and the company plans to roll it out this year, but said no new tests were conducted in the first quarter.

The company did test out a new loyalty program, My Pandora, in France, with plans to introduce it to more markets in 2023.

The test launch was conducted online and in 20 stores, with 50,000 consumers signed up in the first four weeks.

“My Pandora will further improve Pandora’s access to quality consumer data and with the new loyalty program, Pandora will be able to target the consumers directly with content of their interest,” the company.

Pandora is also creating a digital hub in London to attract digital and marketing talent.

Pandora has taken a strong stance against Russian goods.

Pandora made headlines last month when it announced it was leaving the Responsible Jewellery Council, citing the organization’s refusal to cut ties with Russian companies.

It was one of the first to do so, alongside Richemont, and followed by Kering, Watches of Switzerland, and others.

Pandora said it didn’t see any “major impact” on performance due to the war but has suspended business with Russia and Belarus.

Russia, Belarus and Ukraine combined accounted for about 1 percent of revenue in 2021, said Pandora.

“The 153 concept stores and 66 other points of sale in those markets are no longer considered part of Pandora,” said the company.

Pandora operates 2,432 concept stores as of the end of the first quarter, down 227 from the previous first quarter.

Pandora is planning to continue to increase its store network, expecting to open a net 50 to 100 concept stores worldwide.

Lenore Fedowis the associate editor, news at National Jeweler, covering the retail beat and the business side of jewelry.

The Latest

AuctionsSep 27, 2022
In Betty White’s Blockbuster Estate Sale, Jewelry Held Its Own

Fine jewelry comprised three of the auction’s top 10 lots, though it could not top her director’s chair or scripts from “The Golden Girls.”

CrimeSep 27, 2022
3 Suspects in Beverly Hills Smash-and-Grab Robbery Arrested

A total of four suspects are now in custody with police still on the lookout for the remaining two.

ColumnistsSep 27, 2022
Creative Connecting: Fun Ideas for Holiday 2022 In-Store Events

From a “whodunnit” murder mystery to a permanent jewelry party, Duvall O’Steen and Jen Cullen Williams share a wealth of suggestions.

Brought to you by
6 Steps to Start a Dynamic Company Culture

Learn how to better serve your employees, customers and community by having a dynamic and supportive company culture.

MajorsSep 27, 2022
Stuller Releases 2 Updated Catalogs Ahead of the Holiday Season

“Mountings 2023-2024” and “Diamonds & Gemstones 2023-2024” offer a vast selection of options to create custom pieces.

Weekly QuizSep 22, 2022
This Week’s Quiz
Test your knowledge of the latest jewelry news with this quick test.
Take the Quiz
Events & AwardsSep 27, 2022
ICA’s 2023 Congress Will Be Held in Dubai

The event will be hosted by the Dubai Multi Commodities Centre from Feb. 15-17.

IndependentsSep 26, 2022
Roberson’s Fine Jewelry to Close After 42 Years

The store’s liquidation sale will showcase the mix of classic and unique jewels it’s known for stocking.

Brought to you by
Committing to an Ethical Diamond Business

While ethical mining is essential to a diamond business, they represent only a fraction of the responsibility bestowed on jewelers.

CollectionsSep 26, 2022
Go ‘Inside the Dream’ of Bulgari Via a New Documentary on Amazon Prime

It follows Creative Director Lucia Silvestri as she crafts the brand’s high jewelry collections.

Recorded WebinarsSep 26, 2022
Watch: What Jewelers Should Know About Insurance

From safeguarding showcases to appraisal liability, insurance experts Mark Devereaux and Andrew Chipman share insurance tips for jewelers.

TrendsSep 26, 2022
Vahan Collabs With Wolf on a Jewelry Box

It’s the first time in 50 years the brand has made something other than jewelry.

Events & AwardsSep 26, 2022
Texas Jewelers Association Rolls Out New Format for Design Competition

The competition takes place in tandem with TJA’s annual convention, known as the Texas Jewelers Roundup.

CollectionsSep 23, 2022
Pandora Reimagines Keith Haring’s Art in New Collection

The limited-run collection features figures from Haring’s iconic street art on charms, bracelets, rings, and more.

GradingSep 23, 2022
GIA Career Fair Returns to Carlsbad

The Gemological Institute of America also announced plans for events in New York and London in 2023.

SourcingSep 23, 2022
See the Items in Gem Legacy’s 4th Anniversary Benefit Auction

One hundred percent of proceeds will benefit the nonprofit’s silicosis prevention initiative.

CollectionsSep 23, 2022
Piece of the Week: Emily Weld Collins’ Amulet

Inspired by antique coins, it depicts a “hippocamp” from Greek mythology.

EditorsSep 22, 2022
4 Things Seen and Heard at the 2022 HardRock Summit

Gemstones Editor Brecken Branstrator dishes on the latest color to trend, the show floor buzz, and more from Denver.

TrendsSep 22, 2022
There’s a New Book on Tiffany & Co.

Written by historian Vivienne Becker, it accompanies this summer’s Tiffany jewelry exhibition at London’s Saatchi Gallery.

Supplier BulletinSep 22, 2022
Using Commerce Data to Outshine the Competition in the Jewelry Industry

Sponsored by Bloomreach

SourcingSep 22, 2022
First Diamond Recovered From Burgundy’s Ellendale Restart

Burgundy also announced the retail launch of its diamond brand, Maison Mazerea.

Events & AwardsSep 22, 2022
JCK Industry Fund Now Accepting Applications

Organizations with a project or initiative aimed at bettering the jewelry industry are encouraged to apply.

Lab-GrownSep 21, 2022
An Updated Look at the Lab-Grown Diamond Market: Size, Pricing, and More

As the end of 2022 draws near, National Jeweler offers another deep dive into lab-grown diamond market data.

TrendsSep 21, 2022
These Are the Diamond Jewels to Stock for the Holidays

These trending-yet-timeless pieces are no-brainers for customers in search of the perfect gift.

SourcingSep 21, 2022
A Day in the Life: Daniel Namdar, Fancy Color Diamond Specialist

Namdar joins a long line of diamond experts, but his love of the trade was learned rather than inherited.

Lab-GrownSep 21, 2022
Looking Ahead: 4 Factors That Could Shape Lab-Grown Diamonds’ Future

Growing supply and falling prices likely will make differentiation a necessity and a reality, according to analyst Paul Zimnisky.

AuctionsSep 21, 2022
Egyptomania at Sotheby’s: See the Egyptian Revival Jewels Heading to Auction

The auction house is celebrating 100 years since the discovery of King Tut’s tomb.

MajorsSep 21, 2022
Claire’s Expands Walmart Partnership

The chain’s jewelry and accessories are now available in 2,500 Walmart locations.

×

This site uses cookies to give you the best online experience. By continuing to use & browse this site, we assume you agree to our Privacy Policy