May 13 (Bloomberg) -- Pandora A/S is getting a boost from Cupid.
Shoppers have been snapping up the Danish jeweler’s latest collection of charms, one of which features the icon of love for Valentine’s Day. Pandora today raised its annual sales forecast after reporting first-quarter revenue that exceeded estimates, sending shares of the Glostrup-based company to the highest since they started trading in 2010.
“Very good sales growth, that’s really the main story for this quarter,” said Jesper Christensen, an analyst at Alm Brand Markets. “Europe has really been the big surprise.”
Pandora shares rose as much as 9.4 percent in Copenhagen trading, the steepest intraday advance in a year. The jeweler has shifted strategy following a collapse in demand in 2011, bringing out new products more frequently. Items put on sale within the last 12 months, such as a Valentine’s collection featuring the 395-kroner Cupid pendant charm, represented about 50 percent of sales in the quarter.
The increased sales forecast reflects both the strength of the first quarter and an expectation that absolute levels of growth will moderate for the rest of the year, Chief Executive Officer Allan Leighton said in the statement.
Sales in 2014 will be more than 10.5 billion kroner ($194 million), higher than previous guidance of 10 billion kroner, the company said. First-quarter revenue increased 30 percent to 2.59 billion kroner, compared with the 2.32 billion-kroner average of seven analyst estimates compiled by Bloomberg.
Net income rose 61 percent to 704 million kroner, topping the 600 million kroner that analysts anticipated.
Political turmoil in Russia has had no effect on sales, Leighton said on a conference call with analysts, adding that unlike many other retailers Pandora is avoiding price increases to counteract the weakness of the ruble.
“We see no impact on our business,” he said. “In fact, we see this as an opportunity. We want to take advantage of the situation and not price up, and thereby take market share.”
Pandora had 134 Pandora-branded stores in Russia at the end of the first quarter, in addition to 37 shop-in-shops.
The jeweler today raised its forecast for store openings this year, saying it expects to add more than 225 Pandora-branded outlets, compared with previous expectations of 175. The company had 1,137 such stores at the end of the first quarter.
Earnings before interest, taxes, depreciation and amortization are still anticipated to widen to 35 percent of sales versus 32 percent last year, the company said today.
The shares were up 7.4 percent at 389.50 kroner as of 11:45 a.m. in Copenhagen. They’ve gained 33 percent this year.
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