Danish jewellery maker Pandora has revealed its decision to delay its planned relaunch in China due to slower-than-expected recovery from the COVID-19 pandemic. CEO Alexander Lacik stated that while China has the potential to drive future growth for the company, customer demand has not yet reached pre-pandemic levels. Lacik highlighted that middle-income earners in China are exhibiting more caution in returning to the market compared to their counterparts in Europe and the US. With traffic volume still far from normal, Pandora intends to adjust its strategy by adopting a sequential approach, focusing on launching its brand in one city at a time.
Originally, Pandora had planned for a comprehensive marketing campaign for the relaunch across China, but this had to be scaled down due to the pandemic. Despite the challenges, the company remains hopeful that its brand relaunch will eventually spur growth in the Chinese market. Pandora recently raised its lower-end full-year growth outlook after reporting first-quarter results that exceeded analysts’ forecasts.
Although shares in Pandora traded down 2.5% following the announcement, analysts remain optimistic about the company’s performance. Jyske Bank analyst Janne Vincent Kjaer stated that there are no signs of a significant slowdown in sales. Pandora now anticipates organic sales growth between -2% and 3% this year, an improvement from its previous estimate of between -3% and 3%. Analysts polled by Pandora predict a 2% sales growth for the company in 2021. Overall, the first-quarter results are considered a solid start to the year for Pandora.
Useful links:
Pandora Official Website
CNBC Article on Pandora’s CEO Remarks on China Demand
