PARIS – Pandora continued to soar in the third quarter, raising its yearly guidance once more.
The Danish jewelry giant reported sales growing 11 percent to 5.572 billion Danish kroner, or $798 million, for the three months ended Sept. 30.
Revenue exceeded the high range of consensus estimates, which had projected 5.53 billion Danish kronor in revenues and 8 percent growth.
In the first nine months of this year, the company’s revenues reached 13.77 billion Danish kroner, or $1.97 billion.
The company also noted its margins had “reached an all-time high” of 79 percent, which it attributed to channel mix, cost efficiencies and price increases.
Growth in like-for-like terms came from most markets, and positive signs still emerged from the rest.
After a summer of increased tourist traffic, Europe grew 4 percent, driven by Germany leaping 31 percent and France up 5 percent, despite the U.K. and Italy’s contracting by 1 percent each. The company pointed out that “an unexpected pick-up in demand driven by tourists,” including local ones, may not repeat in subsequent years.
The U.S., which accounted for 28 percent of the company’s revenue, rose 4 percent in like-for-like and 5 percent in organic terms. The rest of the world, which accounts for a third of revenue, rose 22 percent.
While China was still flat in like-for-like terms and 7 percent down in organic terms, Pandora noted “positive brand momentum in Shanghai” where the brand recently relaunched. This market currently represents a 2 percent share of revenues.
Consumers were interested in Pandora’s offering across the board, with its core Moments and Pandora Me platforms bringing a cumulated 7 percent rise in like-for-like, and a 14 percent increase for its “Fuel for More” array, which includes the Timeless range and lab-grown diamonds.
The latter, expanded in the quarter with the launch of three new collections, soared 84 percent, albeit from a low base, while the former’s growth was also helped by viral trends such as the #PandoraPromiseRing on Tiktok.
Alexander Lacik, the jeweler’s president and chief executive officer, was “very pleased” with the quarter’s results, saying investments had resulted in increased footfall.
“We have delivered strong broad-based growth whilst our all-time high gross margin underpins our unique earnings model,” he continued.
As a result of these quarterly figures, the company has upgraded its full-year guidance to a 5 to 6 percent bracket, versus the 2 to 5 percent range anticipated last quarter. At the beginning of this year, Pandora had predicted growth to fall somewhere between minus 3 percent to plus 3 percent.
Piral Dadhania, director of luxury goods and premium brands research at RBC Capital Markets, noted that the “magnitude of earnings upgrades could be limited” as consensus was already forecasting a 5 percent increase in organic revenue.
This comes after Pandora’s capital markets day on Oct. 5, where the company said it planned to build its position as a “full jewelry brand” in the affordable luxury space and would increase investments in brand desirability and its store network. At the time, it had also updated profit and revenue projections for the medium term.
