Pandora, the Danish jewellery maker, has reported that its sales have exceeded pre-pandemic levels, primarily driven by strong performance in the United States. While sales in China have declined, the company has experienced rapid growth in the US market. Pandora’s total comparable sales for the second quarter of this year increased by 7% compared to the same period in 2019, prior to the pandemic.
In the United States, quarterly sales more than doubled compared to the previous year and rose by 63% compared to 2019. This significant growth can be attributed to the combination of substantial government stimulus and widespread vaccinations against COVID-19, which have encouraged consumer spending on goods and services.
The company has noticed signs indicating that it is gaining market share in its largest market, the United States. However, it has cautioned that the high growth rates witnessed in the first half of the year are expected to ease in the second half. Pandora’s CEO, Alexander Lacik, mentioned in an interview with Reuters that expectations have been adjusted accordingly, with a focus on increased growth in Europe as stores reopen.
Despite the positive performance in the US, there are concerns about the sustainability of this growth and Pandora’s ability to stabilize its operations in Europe. Handelsbanken noted in a research note that the question arises as to how long the growth in the US market can compensate for weakness in other regions.
In China, the world’s largest jewellery market, sales decreased by 13% in the second quarter compared to 2019. Lacik acknowledged that addressing the situation in China will take time and that the initial steps towards repositioning the brand in the country will be implemented later this year. Further information on this strategy will be revealed during Pandora’s capital markets day in September.
Pandora has recently revised its full-year sales and profit margin forecasts upwards, as it anticipated fewer store closures due to COVID-19. Additionally, the company has announced a new share buyback program, following the trend of other European companies in repurchasing stock after a successful earnings season.
Overall, Pandora’s sales performance showcases the brand’s resilience and adaptability in challenging market conditions. While there are opportunities and obstacles in different regions, the company remains dedicated to solidifying its presence in the United States and reestablishing itself in China. With its positive sales momentum and strategic initiatives, Pandora aims to sustain its growth trajectory in the global jewellery market.
Useful links:
1. Pandora Official Website
