As a result of strong demand in the United States and a "staggering" performance online, Pandora's revenue increased 14 percent year on year in the fourth quarter.
Sales for the three months ended December 31 totaled DKK 9.01 billion ($1.38 billion), according to a company announcement released on Wednesday morning. The United States, the retailer's largest market, accounted for 28 percent of total revenue during the period, up from 25 percent the previous year. On an organic basis, online sales increased by 91 percent during the third quarter. Profit increased by 6 percent, to DKK 1.9 billion ($292.3 million), in the third quarter.
During the quarter, the jeweler noted that “The US continued the very strong performance in the quarter,” The results are “temporarily supported by the stimulus packages and a potential reallocation of consumer spend away from travel and entertainment into discretionary goods.”
Pandora explained that this growth outweighed a weak performance in China, which was negatively impacted by Covid-19 restrictions. Despite the fact that all of the company's stores were open, many of them were in cities that were subject to China's "zero-Covid policy," which resulted in a 40 percent drop in foot traffic year over year. While Pandora had originally planned to begin its repositioning of the brand in China by the end of 2021, the company has now decided to wait until sometime in 2022.
“The purpose of the investment is, among others, to drive traffic to the stores, which makes little sense when street traffic is impacted by Covid-19,” it noted.
Pandora, on the other hand, continues to see potential in China, with plans to triple its business on the Chinese mainland in the long run. It also intends to expand its operations in the United States.
Revenues for the full fiscal year 2021 increased by 24 percent to DKK 23.39 billion ($3.59 billion), while profit increased by 115 percent to DKK 4.16 billion ($638.6 million).
