Pandora Q1 Sales Up 41% to $333M Despite Price Increases

(IDEX Online News) – Pandora nearly doubled its bottom line in the first quarter, rising 90.7% to DKK 515 million ($98.2 million), the jewelry firm reported Thursday. Revenue increased by 41% to DKK 1.75 billion ($332.7 million) in the period.

The company experienced strong underlying growth in the quarter and increased prices in most markets to balance the impact of rising gold and silver prices, CEO Mikkel Vendelin Olesen said, adding that Pandora’s performance was based on a combination of good volume and product mix developments in existing and new stores.

“We are particularly pleased with our continued ability to deliver superior margins in part as result of our combined hedging policy and inventory effect. We remain focused on delivering very strong growth by increasing penetration in existing markets, upgrading existing stores as well as developing new markets. Our updated financial outlook for 2011 remains unchanged," Vendelin Olesen said.

According to the release, reaction to the price increases have varied across markets depending on timing of the price increase, the current consumer environment and the strength of the brand in that market. In some markets Pandora has seen a moderate slowdown immediately after the price increases. “In general, there is some impact on volumes in the 2- 4 months following a price increase, after which volumes gradually recover,” the company said.