Pandora Int. Aps

Management's review

Key activities Business review The Company's main activity is to sell jewelries through owned and operated Concept Stores, Online Store and to wholesale partners in Denmark and distribution of jewelries to markets in Europe. Uncertainty in recognizing and measuring There is no significant uncertainty in recognition and measurement. Unusual events The military aggression on Ukraine has triggered uncertainty in economic developments worldwide followed by significant increase in interests and inflation rates. Trading bans of gas imports from Russia led to energy crisis in Europe. Although decline of consumer confidence and reduced discretional spending was expected the core business of Pandora was not affected and was able to grow in line with the Phoenix strategy. The financial position at 31 December 2023 of the Company and the results of the activities of the Company for the financial year for 2023 have not been affected by this event. Development in the year In 2023 the Company’s revenues declined from DKK 171 million in 2022 to DKK 156 million in the reporting period due to the transfer of the distribution business in Portugal to newly established Pandora owned and operated operation in Portugal in the mid of 2022.Despite the decrease in revenues the gross profit increased versus year 2022 to DKK 19 million. The gross margin has benefited from a higher share of domestic business and increased from 9.5% in 2022 to 12,4% in 2023.The number of employees was increased by 6 to 24 in 2023 due to the opening of new stores in Copenhagen airport. The staff expenses increased by 44% increase in number of employees and inflation. Furthermore, the income statement of the Company for 2023 shows a net profit of DKK 9.9 million (2022: DKK 8.1 million). The revenue and net profit for the year exceeded management expectations set in 2022. Subsequent events and outlook The economic situation is expected to remain volatile but governments and economic experts expect a soft rebound of their economies with reduced price inflation and small growth rates in their gross domestic products for 2024. Altogether the Company is expecting to reach revenue between 155 and 165 million DKK and Net Profit between 7 and 9 million DKK. As mentioned in the outlook and subsequent events section, The Company’s revenue is highly vulnerable to the general economic developments and consumer confidence in Europe and in the other markets where it operates, as well as potential recession caused by geopolitical conflicts affecting European economies.