Pandora Soars as Investors Get Early Glimpse of Results

(Bloomberg) -- The world’s biggest maker of jewelry added roughly a tenth to its market value on Monday after reassuring investors it would reach the upper end of its profit forecast for 2019.

Shares in Pandora A/S rose as much as 12%, as the Copenhagen-based company released some preliminary figures ahead of its Feb. 4 annual results. It now expects its profit margin for 2019 to be in the higher end of the previously guided range of 26-27%.

The update was “definitely good news,” said Per Fogh, an analyst at Sydbank. “Many people had expected Pandora to miss that guidance altogether, so a margin in the upper end of the range shows that Pandora has been able to get its costs under control under its turnaround plan.”

Pandora said its strategy to turn the company around is on track, after a number of turbulent years in which it became a target of hedge funds amid concerns about U.S. demand. In 2018, Pandora lost over 60% of its market value, before rising about 9% last year. The company, which is known best for its affordably priced bracelets and charms, said it now sees signs of “sustainable growth” ahead.

These were some of the highlights from Monday’s statement:

• 4Q total like-for-like sales are expected to be down 4%; means 2019 like-for-like sales will be down 8%
• Organic growth is expected to be negative 1% for 4Q, negative 8% for the full year
• Like-for-like sales are expected to be negative in 2020, and the 2020 Ebit margin excluding restructuring costs is expected to be “lower than in 2019”

To contact the reporter on this story: Christian Wienberg in Copenhagen at cwienberg@bloomberg.net

To contact the editor responsible for this story: Tasneem Hanfi Brögger at tbrogger@bloomberg.net

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