Danish jewellery brand Pandora announced a turnaround strategy that envisages an annual cost saving of DKK 1.2 billion ($183 million) but will incur an anticipated restructuring cost of DKK 2.5 billion ($381 million) through this year and 2020. Pandora stock, which had lost 38 precent over 2018 in the wake of several profit warnings, surged 16 percent after the announcement.
Still without a permanent chief executive ever since Anders Colding Friis was forced out after the first profit warning last year, Pandora, known for its mass-market charms and bracelets, is being run jointly by interim CEO Jeremy Schwartz, who was formerly the CEO of Body Shop, and recently appointed Chief Financial Officer Anders Boyer.
The turnaround strategy involves cutting promotions, a move CFO Boyer says will hit sales in the short term (Pandora is projecting a sales drop of between 3 and 7 percent this year) but will enable the company to rebound more solidly in the longer term, new concepts for its physical and online stores, and reposition its brand positioning to engage the interest of its customer base.
Pandora has previously announced that it would cut 397 jobs — a very small portion of its 27,000 work-force.