Pandora’s 2012 financial results were heavily affected by the company’s ongoing stock balancing campaign, which has led to flat revenues and falling profits.
The Danish charm maker’s net profit for the year came in at $1.2 billion Danish Krone (about $120 million), compared to 2.037 billion Krone the prior year. Group revenue for 2012 totaled DKK 6.652 billion (approx. $1.17 billion), slightly higher than last year.
“2012 was a year of re-setting the business,” said CEO Bjørn Gulden in a statement. “We started the year with two major initiatives: realigning the products and prices, and improving the quality of stock with our retailers by replacing slow moving items with best sellers. After a difficult first half where we worked hard on implementing these initiatives, it is encouraging to see the positive developments in third and fourth quarters.”
The American market has “continued to perform well,” the company said. In the United States, revenue grew 5.3 percent in the fourth quarter over the prior year—though in local currency, the increase only measured 0.8 percent. Comp sales at Pandora’s U.S. concept stores grew 6.9 percent.
The biggest gaining category for the company was rings, whose sales jumped 18.4 percent.
The company also announced a $120 million share buyback program.
In a conference call following the results, Pandora CEO reportedly denied rumors that he would leave the company to head Puma.
In the company’s annual report, Gulden and chairman Allen Leighton said the company is charging ahead with e-commerce plans, noting it has launched a pilot PANDORA eSTORE in the United Kingdom. The company plans to roll out more eSTORES throughout Europe over the coming year.