Pandora’s chief executive officer Anders Colding Friis will step down after the world’s biggest jewelry maker earlier this week lost almost a quarter of its market value following a profit warning.
Colding Friis, 54, will leave as of Aug. 31. The Copenhagen-based company has started a search for a replacement, while it also hired former Body Shop CEO Jeremy Schwartz as chief operating officer. The shares rose more than 10 per cent in early trading.
Struggling to keep up growth after a rapid global expansion, Pandora on Aug. 6 lowered its outlook for 2018 profit and sales, sending the shares down 24 per cent and sparking speculation on whether Colding Friis would be able to keep his job. The company said on Thursday it was beset by a range of problems, including weaker-than-expected sales of new charm bracelets and rising costs.
Colding Friis had at the start of the year sought to reset the company’s targets, seeking more “realistic” goals as its expansion slows. While he now acknowledges that he had been “a bit too optimistic,” Colding Friis said that he still believes in the strategy he had laid out for Pandora.
“I don’t have a lot of regrets when it comes to the things we’ve done together at Pandora,” he said in a Bloomberg TV interview.
The CEO’s departure will probably “be taken positively by the market as many eagerly awaited a reshuffle in Pandora’s management team,” Zuzanna Pusz, an analyst at Berenberg, said in a note.
The company late Monday said that it expects sales to grow 4 to 7 per cent in local currencies this year, down from a forecast of 7 to 10 per cent. It warned its profit margin on earnings before interest, tax, deprecation and amortization will be lower than anticipated at about 32 per cent, down from a prediction of 35 per cent.
Pandora has in recent years battled retail weakness in the U.S., and this year problems also arose in China where a grey market eroded sales and profits. At the same time, hedge funds have built short positions against its stock, cashing in on the decline.
The shares have lost an annualized 15 per cent since Colding Friis started in March 2015, according to data compiled by Bloomberg. That compares with a 3.1 per cent decline in a peer group of companies.
Pandora’s time as a listed company has been a roller-coaster ride. In the period 2011 through 2016, the shares jumped almost 20-fold as the company repositioned itself in the so-called affordable luxury segment.
Colding Friis joined to enjoy the tail-end of that golden period before problems started to dominate the agenda and depress the stock. He was previously CEO of Scandinavian Tobacco Group.
Schwartz will come on board as COO as of Sept 1. He will jointly manage the company with CFO Anders Boyer until a new CEO is found, the company said.