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BREAKING NEWS

Jeweller Pandora plans cost cuts, sales seen falling

Jeweller Pandora plans cost cuts, sales seen falling
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Benoit Tessier(Reuters)
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COPENHAGEN (Reuters) - Jewellery maker Pandora, struggling to regain its competitive edge in a weak retail market, plans to make cost savings of 1.2 billion crowns as it faces a drop in organic revenue growth of between 3 and 7 percent this year.

The Danish charm-bracelet maker, currently looking for a new chief executive, has been challenged by a fall in the number of shoppers visiting malls in its key markets, while new jewellery lines have failed to entice shoppers.

"We are confident that this company-wide business transformation will reignite Pandora, restore sustainable growth and support our industry-leading margins," said chief operating officer and former Body Shop CEO Jeremy Schwartz on Tuesday.

The firm has been without a chief executive since ousting Anders Colding Friis following a first profit warning in August last year. Schwartz and newly appointed chief financial officer Anders Boyer are running the business for now.

Sales this year would be negatively impacted by a decision to reduce promotional activities, the company said. Pandora's 2019 EBIT margin is seen at 26-28 percent, excluding restructuring costs of up to 1.5 billion crowns.

Fourth-quarter EBITDA (earnings before interest, tax, depreciation and amortisation) fell almost 8 percent from the same period the previous year to 2.8 billion Danish crowns, but were above the 2.5 billion expected by analysts in a Reuters poll.

The firm also proposed to buy back 2.2 billion crowns worth of shares in 2019 and said dividends would remain at the same level as in 2018.

(Reporting by Stine Jacobsen; Editing by Jacob Gronholt-Pedersen and Kirsten Donovan)

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