COPENHAGEN, November 1 (Reuters) – Shares of Pandora (PNDORA.CO), the world’s largest jewelry maker in terms of production capacity, fell sharply on Monday as investors worried about weak sales growth in its own stores in the third quarter.
The Danish company lifted its outlook for the full year, citing strong sales in the United States, but its share price fell 4.8% at the start of trading as it also said the Pandora store sales grew only 5% in the third quarter, while analysts expected growth of 14%.
Pandora shares had jumped 40% this year, as the company recorded sales at higher pre-pandemic levels since stores reopened after the closings.
“Sales growth at a loss is rather disappointing in the third quarter,” said Sydbank analyst Per Fogh.
Still, the company said it continued to see strong sales in the United States, its largest market, in the third quarter as massive government stimulus measures and COVID-19 vaccinations fueled spending. in goods and services. Read more
For 2021, Pandora now expects organic sales growth of 18-20%, against a previous forecast of 16-18%, and a profit margin before interest and taxes (EBIT) of 24-24.5%, up from previous forecast 23-24%. However, that was lower than an average forecast of 24.6% from analysts compiled last month.
“COVID-19 and the unusually high level of US growth continue to create increased uncertainty around the forecast,” he added.
Pandora, best known for its silver charm bracelets, said third-quarter sales amounted to DKK 4.73 billion ($ 734.92 million), exceeding the 4.67 billion analysts expected. in a survey conducted by the company.
He announced a quarterly EBIT of 957 million kroner, higher than the 917 million expected by analysts, and resulted in an EBIT margin of 20.2%.
“Both revenue growth and EBIT margin were driven by the continued strong performance in the United States and sequential improvement in Europe as COVID-19 restrictions were relaxed,” Pandora said.
The company will release its full third quarter results on November 3.
Reporting by Stine Jacobsen, additional reporting by Milla Nissi; Editing by Jan Harvey and Susan Fenton
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