Shares of Pandora, the world’s largest jewelry maker by production capacity, fell sharply on Monday as investors worried about weak sales growth in its own stores in the third quarter.
The Danish company raised its outlook for the full year, citing strong sales in the United States, but its share price fell almost 7% 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 have jumped 40% this year, with the company posting sales at the highest pre-pandemic level since stores reopened after 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.
For 2021, Pandora now expects organic sales growth of 18% to 20%, compared to a previous forecast of 16% to 18%, and a profit margin before interest and taxes (EBIT) of 24% to 24.5. %, forecast 23 to 24 percent. 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 were $ 734.92 million, beating the estimate of an analyst survey compiled by the company.
It reported quarterly EBIT higher than analysts’ estimates 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.