By Lenore Fedow
A Pandora store in Birmingham, England. The Danish jewelry company expects sales to be down 40 percent in its second quarter but noted improvement as its stores begin to reopen.
Copenhagen, Denmark—Pandora is forecasting a better-than-expected second quarter as its stores reopen and sales improve.

The company released its preliminary second-quarter results Wednesday, outlining how the jeweler has fared so far amid the coronavirus pandemic.

Quarterly sales were down 40 percent year-over-year, though the company highlighted a partial rebound in May and June.

Its positive growth has continued with its performance in June surpassing that of the previous two months.

Its online sales have done particularly well, posting a 176 percent in organic growth for the quarter.

“The online business is firing on all cylinders, and this is a resilient channel that we can continue to push very hard,” said CEO Alexander Lacik during Pandora’s first-quarter earnings call in May.

The jeweler plans to invest more in its digital capabilities, including tech and data analytics, as part of its multipronged turnaround plan announced back in March.

Its physical stores have gradually reopened; 86 percent of its open concept stores, those owned by Pandora and franchise owned, are now open.

The company is implementing health and safety guidelines like social distancing in its locations, which it said has impacted its ability to serve customers, particularly during peak periods.

Traffic in the reopened stores is slowly improving, Pandora said.

The retailer has increased its media spending as markets have reopened “to gain early commercial momentum as consumers are returning to stores.”

Pandora updated its earnings guidance for the second quarter, expecting its EBIT (earnings before interest and taxes) before restructuring costs to be “roughly breakeven” compared with its previous guidance for negative EBIT.

The company cited the reopening of markets, quicker-than-expected traffic recovery, and its strong online sales as the reasons behind its brighter forecast.

Pandora said it will continue to suspend its 2020 financial guidance since the macroeconomic environment and future COVID-19 developments are “highly uncertain.”

The company will release its full second-quarter report Aug. 18.

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