Pandora warns tariffs may cut 2025 earnings by DKK 500 mln, lowers margin view

Investing.com -- Pandora (CSE:PNDORA) on Friday said that the U.S. tariffs could reduce its 2025 earnings by as much as DKK 500 million if higher rates resume after Aug. 10, while also lowering its EBIT margin forecast to around 24% from about 24.5% due to commodity and currency headwinds.

The Danish jewelry company maintained full-year guidance for organic revenue growth of 7-8%, supported by like-for-like growth of 4-5%, network expansion of about 3% and forward integration of around 1%. Local currency growth is projected at 8-9%.

Pandora outlined two tariff scenarios. If current levels remain, the company expects a DKK 250 million impact in 2025 and DKK 300 million annually thereafter.

If higher tariffs return, including 37% on imports from Thailand and 145% on imports from China, the impact would rise to DKK 500 million in 2025 and DKK 900 million annually.

In April, Pandora said the effect could reach DKK 1.2 billion annually before mitigation, though direct shipping to Canada and Latin America from 2026 is expected to ease the burden.

The company said the combined impact of silver and gold prices and foreign exchange movements represents a 280 basis point drag compared with 2024.

A weaker U.S. dollar and depreciation of the Australian dollar, British pound, Turkish lira and Mexican peso contributed to the pressure, partly offset by a weaker Thai baht.

Pandora said price adjustments and operational efficiencies are expected to offset inflationary pressures, including higher salaries.

Other guidance includes plans to open a net 50 to 75 concept stores in 2025, with at least 50 net closures in China, and about 25 Pandora-owned shop-in-shops.

Capital expenditure is expected to be around 7% of revenue. The effective tax rate is forecast at about 24%, slightly below recent years, following a bilateral advance pricing arrangement between Danish and Australian tax authorities.

Net financial expenses are expected at DKK 900-950 million, down from previous guidance of DKK 1-1.05 billion, due to foreign exchange adjustments.