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RAPAPORT... Pandora Jewelry's revenue jumped 26.2 percent year on year to $475 million (DKK 2.845 billion) in the third quarter that ended on September 30. Sales by unit volume rose 15.7 percent and the average price per transaction increased 9 percent to $24.20 (DKK 145). The jewelry brand stated that the increase in average price was due to higher consumer demand for Pandora rings, which are typically more expensive than charms. Gross margin as a percentage of sales improved to 70.3 percent compared with 66.2 percent one year earlier. Profit improved 18.5 percent to $121 million (DKK 725 million). The company's inventory level rose 32.6 percent to $355 million (DKK 2.126 billion). Pandora observed strong growth for jewelry in the U.K., Europe and Asia Pacific. By regional market, sales in local currency increased 13.9 percent in the U.S., while surging 28.4 percent across other "Americas" markets. Revenue from the U.K. jumped 26.4 percent, while Europe's sales surged 34.3 percent; however, Germany's growth was only 2.1 percent. Sales in Australia improved 15.6 percent, while revenue skyrocketed 69.3 percent across other regions of the Asia Pacific. Revenue from Pandora's charms improved 22 percent year on year to $298 million (DKK 1.788 billion), while silver and gold charm bracelets jumped 27.6 percent to $65 million (DKK 388 million) and ring sales surged 97.7 percent to $57 million (DKK 344 million). The sale of other jewelry rose 4.5 percent to $54 million (DKK 325 million). Pandora opened 93 new concept stores in the third quarter, including 22 in the Americas, 58 across Europe and 13 in the Asia Pacific region. The brand has increased its store network by 448 points of sale in the past 12 months, while closing 952 underperforming and unbranded stores. At the end of the quarter, Pandora operated 9,841 points of sale. During the period, Pandora acquired 27 concept stores in the northeastern U.S. from Hannoush in a transaction that was valued at $28 million. In addition, Pandora anticipates spending $6 million on remodeling the stores. Pandora also signed an agreement with Bluebell in Japan for joint distribution of jewelry, beginning January 1. The Bluebell agreement stipulated that Pandora purchase the majority of assets in Japan in a non-cash transaction; the term of the deal is five years and upon termination of the agreement, Pandora would take control of distribution in Japan with a total amount to be paid Bluebell -- dependent upon revenue in 2019 -- estimated between $9 million (DKK 52 million) and $26 million (DKK 156 million).
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