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Jewelry maker Pandora announced on Tuesday that it will drive growth in the US and China and expand into new segments, such as watches and bags, after operating profit in the first quarter exceeded expectations.
The impact of strong online sales and stimulus packages in the United States was more than four times the operating profit of 903 million kroner in the January-March period, which the company forecast is more than 833 million crowns.
Alexander Lasick, CEO of Pandora, told Reuters in an interview that Pandora’s new strategy aims to strengthen the brand in key markets, especially in the two largest economies in the world, and expand into other product categories over time.
“We see unused opportunities in the US and China where our brand penetration is still very low,” Lasik said. “We have better opportunities to grow (there) instead of expanding into new regions.”
“For now we will continue to stay in the jewelry segment,” he added, adding that I see the potential for further growth in charm and bracelets that make up 70% of the business. “However, in the long run, we think about other avenues of growth.”
This includes expanding the range of jewelry under the Pandora brand or adding other brands, he explained.
The company said 30% of 2,700 stores worldwide were closed in the first three months of the year due to locking operations related to the corona virus infection.
“We have a good start by 2021, not least when you consider that many of our stores are closed,” Lasik said.
Every fifth store is currently closed, but the company raised its full-year sales and profit forecast on Monday in anticipation of reopening.
Shares of Pandora, which had tripled in the past year, rose 5% at the start of trading.
The group’s sales have increased tenfold in the decade 2017, as Pandora has been able to find a niche among the cheap accessories available in stores such as H&M and the more expensive jewelry supplies from companies such as Tiffany & Co.
However, the company suffered a major setback due to the lack of innovation that sidelined buyers and investors.
Since joining Pandora in early 2019, LASIK has cut costs and accelerated the expansion of e-commerce.
Pandora, which sells three pieces of jewelry per second, announced on Tuesday that it will stop selling cut diamonds and focus on cheaper, more stable, laboratory-grown gemstones.
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