COPENHAGEN (Reuters) - Danish jewellery maker Pandora has agreed with German fashion retailer DHG Gmbh to take over up to 78 commercial leaseholds in Germany and this year plans to open concept stores in the new locations, it said on Monday.
The total investment for the new stores this year is expected to be around 50 million euros (39 million pounds), including capital expenditure and inventory.
“This will be a significant strategic step for Pandora in Germany, which accelerates our strategic plan for this market,” Niels Moller, head of the company’s central western Europe region, said in a stock exchange announcement.
Since 2011 the company has focused its retail network in Germany more on its branded concept stores instead of selling via jewellery stores alongside other brands.
“This makes good sense for Pandora, it is 78 very attractive leaseholds,” analyst Soren Lontoft Hansen from Sydbank said. “However, we need to see more increase in revenue and earnings in Germany before it will impact the share price”.
The impact on revenue and core earnings for 2015 is expected to be limited due to the gradual roll-out of the stores, Pandora said.
Pandora generated just 372 million Danish crowns (39 million pounds) out of its 7.98 billion crowns in total revenues in Germany in the first nine months of 2014.
Its shares were up 0.9 percent higher at 514 Danish crowns per share at 0855 GMT. They gained more than 70 percent in 2014, outperforming a 18 percent rise in the Danish benchmark index OMXC20CAP.
Reporting by Teis Jensen; editing by Jason Neely