Pandora falls anew as CEO suite remains vacant

By BLOOMBERG

COPENHAGEN • Pandora A/S has come undone again.

The Danish charm bracelet seller’s shares fell as much as 12% after it cut its outlook, abandoned a long-term sales goal and said it’s still looking for a CEO. Since hitting a peak two years ago on the back of a global expansion, the company has fallen to earth amid the rise of online shopping and cheap Chinese imitations, wiping almost US$12 billion (RM50.04 billion) off its market value.

As Pandora seeks a new leader, successive profit warnings have undermined investor confidence, prompted hedge funds to take aim at the stock and fuelled takeover speculation. The company said it will try to “reset” its business by cutting costs, insisting that the absence of a CEO won’t hold it back.

CFO Anders Boyer said the latest results were “unsatisfactory”. Per Hansen, an investment economist at Nordnet in Copenhagen, was more blunt, describing them as “terrible”.

After at least two years of false starts in which the jeweller has been struggling with an increasingly challenging US retail environment, investors are losing faith.

Pandora’s move to reposition itself in the so-called affordable luxury segment, during which it expanded to more than 2,500 stores in shopping malls around the world, has fallen flat. The market value, which rose to just shy of 120 billion kroner (RM75.06 billion) after a more than 20-fold runup in the shares from 2011 through mid-2016, has plunged to about US$6.1 billion.

Pandora “is facing an increasing number of issues which we now determine to be more structural than cyclical,” RBC analysts said in a note. “We do not see any immediate fixes to improve investor sentiment.”