* Q3 EBIT 743 mln crowns vs year-earlier 251 mln
* Sees 2010 sales at 6.2 bln crowns, EBITDA 2.5 bln
* Q3 boosted by early Christmas orders, will affect Q4
* Poised to enter Russia, China by year-end
* Shares surge 9 pct, taking gain since IPO to 42 pct
(Adds CEO comments, detail, updates share price to close)
By Anna Ringstrom and Shida Chayesteh
COPENHAGEN, Nov 11 Jewellery maker Pandora
(PNDORA.CO), a newcomer to the bourse, said on Thursday growth
across all regions and product categories helped it triple
profit in the third quarter.
Shares in the fast-growing firm, which debuted on the
Copenhagen bourse on Oct. 5, soared as analysts said earnings
and sales exceeded expectations and pointed out the firm has
become slightly less dependent on its trademark product.
Pandora makes mass-market jewellery sold mainly in Europe
and the United States and is eyeing emerging markets for growth.
Its hit product line, charm bracelets and charms, brought 79
percent of sales in the quarter, against 90 percent a year ago.
The stock market listing of Pandora, which was established
as a Copenhagen shop in 1982 and has grown briskly over the past
decade, was one of Europe's largest this year. [ID:nLDE694066]
Helped by early Christmas orders, operating profit soared to
743 million crowns ($137 million) from 251 million a year
earlier. Sales more than doubled to 1.79 billion, half of which
came in Europe, from 825 million.
"Some of the sales that we normally have in the fourth
quarter have already taken place in the third quarter," Chief
Executive Mikkel Vendelin Olesen told Reuters. [ID:nWEA8960]
FIVE A DAY
Pandora opened 464 points of sale in the quarter -- on
average five a day -- taking the total number to 10,386,
including more than 320 Pandora-branded concept stores, it said.
"Since our July entry into Italy, Europe's biggest market
for genuine jewellery, we have managed to establish nearly 150
new outlets. That bodes well for our future entry into big
markets such as Russia and China," Olesen said in an email.
Pandora aims to open its first shops in China and Russia by
year-end. Olesen told a news conference the firm aims to open
500 points of sale in 2011, a slower pace than this year.
The firm guided for full-year sales of around 6.2 billion
crowns, up from 3.5 billion in 2009, and earnings before
interest, tax, depreciation and amortisation around 2.5 billion
crowns, against 1.6 billion last year.
"These are strong expectations that exceed mine, especially
on sales. I expect the demand to continue in 2011," Sydbank
analyst Soren Hansen said.
BEST IN CLASS
Pandora shares closed up 8.8 percent at 298 crowns -- 42
percent above its IPO price of 210 crowns -- while Copenhagen's
blue-chip index .OMXC20 was nearly unchanged.
"There are not many listed jewellers. Foreign investors in
particular are attracted to it," Hansen said, explaining the
"Pandora has a very interesting business model compared with
some peers in that they have their own production, design and
distribution channels, and are mainly wholesale-based," he said.
"Their margins are best-in-class in their business."
Its jewellery, priced between $50 and $1,500, is made for
relatively low cost in Thailand.
Analysts have said raw material costs could be a worry for
Pandora -- safe-haven commodity gold hit another record this
week as investors aim to protect their inflation exposure.
Olesen told Reuters that Pandora would pass on higher costs
to customers, and had raised prices in Britain and the U.S.
Pandora said it hedged 100 percent of its gold and silver
consumption in the third quarter. "For the following four
quarters we have hedged 100 percent, 80 percent, 60 percent and
40 percent of expected gold and silver consumption," it said.
($1=5.406 Danish Crown)
(Additional reporting by Teis Jensen, Editing by Hans Peters
and David Hulmes)