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Pandora A / S: Q4 2021 – Checklist


Q 4 2 0 2 1 – aide-memoire

Pandora Investor Relations

Advice

Returned

Full yearadvice: Pandora has revised its guidance upwards on November 1, 2021. Organic growth has been revised upwards

at 18-20% (vs 2019: 5-7%) against 16-18% previously (vs 2019: 3-5%). The implied forecast for the fourth quarter is 2-7% organic growth from 2019, which equates to approximately -1 to 4% organic growth from 2020. The upward revision of the forecast was prompted by strong performance in the third quarter and an updated forecast for the full year.

Assumptions behind annual forecasts

  • 5% of stores will be temporarily closed or severely impacted due to COVID-19 in Q4 2021.
  • Full yearnegative revenue impact of around DKK 1 billion or -6% COVID-19 due to temporarily closed / impacted stores and partial online recovery of lost revenue.
  • No major negative impact on the production or supply chain of COVID-19 in Q4.
  • No other material COVID-19 restrictions implemented beyond what is currently in place to date (November 3, 2021 upon release of third quarter results)
  • The unusual growth seen in the United States in 9M 2021 will subside in Q4 2021.
  • China to remain a drag on total revenue growth in 2021
  • The eventual integration is expected to add around 1% of revenue in 2021.
  • The headwind of exchange rates of about -1% bringing the total turnover to between 22.4 and 22.8 billion DKK in 2021.

Quotes on updating revenue forecast for 2021:

  • “Where we land in this 18-20% range depends in particular on the level of US sales here in the fourth quarter. And as usual, it’s also worth remembering that even though we only have nine weeks left in the year, it’s nine big weeks. And these nine weeks that we have left of the year are not far from a third of the sold for the entire year. We are, as usual, in full peak season ”

Q4 2021 | Checklist | Page 1 | 4

EBIT margin

Full yearadvice:The EBIT margin forecast was raised on November 1 to 24-24.5% from 23-24% previously, due to the operating leverage of the revised revenue forecast. Forecasts assume that Pandora will invest DKK 0.1 billion in the fourth quarter in repositioning the brand in China from DKK previously.

0.2 billion in H2. The investment was limited to Q3. and Pandora could postpone the investment planned for Q4 2021 to 2022, due to the current retail environment in China following COVID-19.

Net profit

Full yearadvice:Currency exchange rates are expected to have a favorable impact of 1.0 pp on the guided EBIT margin. Therefore, given Pandora’s hedging policy of hedging 70% of annual cash flows from major currency exposures, currency hedging will have a negative impact on net income.

Other guidance settings

  • CAPEX forecast for the year has been updated and Pandora now expects CAPEX to be around DKK 0.8 billion (previously around DKK 1.0 billion)
  • In addition, Pandora expects about 50 concept store closures compared to the previous expectation of 25-50 concept closures blinds.

Quotes on other 2021 guidance settings:

  • “And just to avoid misunderstandings and let me be very clear that the lower CAPEX does not reflect any sort of uncertainty about strategy or the like, it is mainly a reflection of the pandemic and the natural postponement of some investments as a result of this, including in Thailand. “

Q4 2021 | Checklist | Page 2 | 4

Q3 2021 performance quotes

  • “We are very satisfied not only with the strong numbers per word, but above all with the fact that they turned out to be of high quality (…) Moments, our biggest platform and the heart of Pandora grew by 11%. This is particularly pleasant, as we have been told from the start that this platform remains vital and offers good prospects for growth. “
  • “Geographically, we actually have three quite different images. First, the US jewelry market continues to grow at an unusually high rate supported by stimulus programs. Most importantly, Pandora continues to grow at an even higher rate – as we have. done in the last two quarters. On this basis, we continue to believe that we are gaining market share. Second, Asia / Pacific was hit hard by COVID-related issues, particularly China and Australia weighed on our group’s results in the quarter Third, we saw a very strong rebound in our core European markets, with a growth in outside sales during the quarter. ”

Sequential worldwide deployment of Pandora Brilliance – Diamond collection created in the laboratory

  • Pandora launched a test launch of Brilliance in the UK market in May with the aim of making Brilliance a new platform alongside Moments by democratizing diamonds
  • As announced during Capital Markets Day, the launch of the test was primarily aimed at obtaining information:
    • Test → get info → adjust → scale (stop)
  • Pandora got some useful insight from the UK test launch and is confident that Brilliance has the potential to become a new platform.
  • Pandora will therefore launch a new sequential global rollout starting in 2022 – country details to be shared as launch dates approach.

Quotes about the sequential rollout of Brilliance:

  • “Part of the reason for testing instead of immediate global deployment was to learn and refine our go-to-market toolkit. It’s a new segment for Pandora in many ways, and we needed to verify and obtain important information before considering further geographic expansion. Based on lessons learned to date, we are confident that we have generated enough information for a successful deployment. “

Money distribution

  • On Capital Markets Day on September 14, Pandora announced an increase in the ongoing DKK 500 million share repurchase program announced on August 17. As part of the revised program, Pandora will repurchase shares for a maximum total amount of DKK 3.5

Q4 2021 | Checklist | Page 3 | 4

billion. The revised program is due to be concluded by February 4, 2022 at the latest. In total, this brings the planned share buybacks to DKK 4 billion for the period May 5, 2021 to February 4, 2022.

  • The last extraordinary dividend of 5 DKK was distributed on November 17th. Pandora distributed a total of DKK 15 per share to its shareholders in the form of extraordinary dividends in 2021.

Other topics

  • Pandora performed very well in the United States throughout 2021 with sales growth of 59% compared to 2019 in the first nine months of 2021. The strong unusual growth in the US should ease in the fourth quarter and Pandora recognizes that there is a general uncertainty about how the overall US market will develop in 2022. Pandora is convinced that “… whatever direction the US market as a whole takes in 2022, we believe we have enough ammunition in the plans to outperform the US market as a whole – as we did in 2021”.
  • On 14 September 2021, Pandora has hosted its Capital Markets Day deploying the Phoenix strategy while providing financial targets for 2023. The financial targets for 2023 are based on 2021 as reference. “The 2021 reference scenario is impacted by two non-recurringelements. i) Negative impact due to temporary store closures due to COVID-19[female[feminineand ii) the positive impact of US stimulus packages. The net impact of this on 2021 turnover and therefore the 5-7%growth objective and 25-27%The EBIT margin is obviously associated with high uncertainty. “
  • Pandora has taken a wide range of precautionary measures to ensure a healthy inventory position until the fourth quarter of 2021. Already in the second quarter, 1,000 additional people were hired, while managing to continue to increase the inventory position throughout. throughout the year. Pandora maintains close dialogue and cooperation with Thai authorities, while closely monitoring and supporting suppliers to ensure a healthy production flow. “Our production was affected, but we were able to maintain the disruption so that it did not have a significant impact on our ability to meet demand. This is a major achievement given the circumstances“.

Remarks

  • Pandora will enter a period of silence on January 12, 2022.
  • Pandoras’ fourth quarter 2021 interim financial report, 2021 annual report and 2021 sustainability report will be released on February 9, 2022.
  • Pandora Collection the pre-Q4 consensus will begin in mid-January.

Q4 2021 | Checklist | Page 4 | 4

Disclaimer

Pandora A / S published this content on 08 December 2021 and is solely responsible for the information it contains. Distributed by Public, unedited and unmodified, on December 8, 2021 2:21:13 p.m. UTC.

Public now 2021

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Analyst Recommendations on PANDORA A / S
Sales 2021 22 800 M
3,472 million
3,472 million
Net income 2021 4 317 million
657 million
657 million
Net debt 2021 4,023 million
613 million
613 million
PER 2021 ratio 19.8x
Yield 2021 2.07%
Capitalization 83,718 million
12,757 million
12,748 million
VE / Sales 2021 3.85x
VE / Sales 2022 3.55x
Number of employees 26,000
Free float 93.2%

Duration :

Period:

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Trends in technical analysis PANDORA A / S

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Tendencies Neutral Neutral Bullish

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Average consensus SURPASS
Number of analysts 15
Last closing price

868.60 DKK

Average price target

959.20 DKK

Spread / Average target 10.4%