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Anders Colding Friis, is stepping down, the firm said on Thursday, just days after warning of lower sales and profit margins this year. Shares in Pandora, known for its silver charm bracelets, have plunged by more than a fifth since the company lowered its sales and profit margin guidance for this year and announced plans to cut almost 400 jobs on Monday. Pandora confirmed preliminary second-quarter sales of 4.8 billion crowns and an EBITDA margin of 31.1 percent released on Monday in connection with the profit warning. Like-for-like sales growth in the second quarter was down 1 percent compared to a 5 percent decrease in the previous quarter. The quarterly results were below its expectations partly due to a weak development in the charms category, it said in a statement.
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It acknowledged that the strategy it launched in January, aimed at rectifying a lack of innovation and weak growth in key markets, was not progressing as fast as expected. "We still believe in our strategy towards 2022, but we have realized that we have been too optimistic on the speed of the impact from new products," said Friis, the outgoing chief executive. Pandora said in January it would target an EBITDA margin of 35 percent in 2018-2022 and expects sales to increase by 7-10 percent per year in the period. Late on Monday, it slashed its 2018 sales growth outlook to 4-7 percent, and its EBITDA margin outlook for the year to around 32 percent.
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This is the fifth time Pandora has changed CEOs since it went public in 2010. While the company has not yet announced a successor, following Friis’ departure, former Body Shop CEO Jeremy Schwartz will join the company as chief operating officer. Schwartz and chief financial officer Anders Boyer, a board member who just became CFO last week, will jointly manage the company until a new chief executive is appointed. On the conference call, Friis admitted that Pandora’s new collections of its signature charms had failed to live up to expectations, which he attributed to a shift in consumer behavior. “Bracelets continue to be in high demand and are developing well.
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“Where they used to wear six or seven charms on the bracelets, they now wear five…. Simplicity is something that consumers are looking for…. We just have to accept and adapt to a point where we see less charms on a bracelet.” Shares are down almost 50% on the year, with much of that coming amid a recent revision to the company's full-year 2018 revenue and EBITDA targets. In the wake of that news, CEO Anders Colding Friis stepped down, and the company announced that it would be searching not only for a new CEO in the next few months but also for some new board members. buying out franchisees, increasing e-store penetration, and other cost-cutting efforts.