Pandora — Earnings Release 2012

Feb 26, 2013

No. 69
COMPANY ANNOUNCEMENT
26 February 2013

GROUP REVENUE WAS DKK 6,652 MILLION. EBITDA MARGIN WAS 24.9%. NET PROFIT WAS
DKK 1,202 MILLION. FREE CASH FLOW WAS DKK 1,151 MILLION.

The reported full year figures in this report are slightly better than
anticipated, but adversely impacted by the effect from the stock balancing
campaign launched on 21 February 2012.

-- Group revenue in 2012 was DKK 6,652 million compared to DKK 6,658 million
in 2011:
-- Americas increased by 5.3% (2.5% decrease in local currency)
-- Europe decreased by 3.1% (5.0% decrease in local currency)
-- Asia Pacific decreased by 10.4% (17.5% decrease in local currency)

-- Gross margin decreased to 66.6% in 2012 (compared to a gross margin of
73.0% in 2011)

-- EBITDA margin was 24.9% in 2012 (compared to an EBITDA margin of 34.3% in
2011), EBITDA decreased by 27.3% to DKK 1,658 million

-- EBIT margin was 22.2% in 2012 (compared to an EBIT margin of 30.9% in
2011), EBIT decreased by 28.3% to DKK 1,475 million

-- Reported net profit decreased by 41.0% to DKK 1,202 million in 2012
(compared to a net profit of DKK 2,037 million in 2011). Excluding the
earn-out provision adjustment for PANDORA CWE, 2012 net profit decreased by
24.6% to DKK 1,151 million (compared to an adjusted net profit of DKK 1,526
million in 2011)

-- Free cash flow was DKK 1,151 million in 2012 (compared to DKK 1,670 million
in 2011)

-- For the financial year 2012, the Board of Directors proposes a dividend of
DKK 5.50 per share corresponding to a pay-out ratio of 59% (compared to 35%
in 2011)

-- PANDORA expects revenue for 2013 to be above DKK 7.2 billion and expects an
EBITDA margin above 25%

-- Today PANDORA will initiate a share buyback programme for up to DKK 700
million to be completed during 2013
with the primary purpose of reducing the Company’s share capital
at the Annual General Meeting in 2014

Financial GUIDANCE for 2013

PANDORA expects revenue for 2013 to be above DKK 7.2 billion and expects an
EBITDA margin above 25%.

PANDORA expects CAPEX to be around DKK 300 million and expects an effective tax
rate of approximately 19%.

During 2013 PANDORA expects to open approximately 150 Concept stores.

Board of directors evaluation of CAPITAL STRUCTURE

As previously communicated the Board of Directors has analysed what it believes
to be an optimal capital structure for the Company, including making a decision
on how to distribute surplus capital to the shareholders. The outcome of this
analysis is a combination of a change in dividend policy as well as the
initiation of a share buyback programme.

The Board of Directors has previously targeted an average dividend pay-out
ratio of approximately 35% of the consolidated net profit for the year defined
in accordance with IFRS. Going forward, the Board of Directors aims to maintain
a stable and then increasing nominal dividend per share, using the dividend for
2011 of DKK 5.50 per share as the reference point.

In addition and taking the above into account, the Board of Directors will, on
an on-going basis, determine whether any surplus capital should effectively be
distributed through share buyback programmes or as an extraordinary dividend in
order to reach an optimal capital structure, which the Board of Directors, at
this point in time, view as a NIBD/EBITDA ratio of 0-1x on 12 months rolling
basis.

This policy and PANDORAs ability to distribute surplus capital to the
shareholders will be dependent upon, amongst other things, the availability of
sufficient distributable reserves, the Company’s financial condition, results
of operations, capital requirements and such other factors as the Board of
Directors may deem relevant.

Share buyback programme for 2013.

The Board of Directors of PANDORA has decided to launch a share buyback
programme in 2013 (the “Programme”), under which PANDORA expects to buy back
its own shares up to DKK 700 million. According to of the decision made at the
Extraordinary General Meeting held on 17 September 2010, PANDORAs Board is
until 17 September 2015 authorised to acquire own shares on behalf of the
Company with a total nominal value of up to 10 % of PANDORAs share capital (the
“Authorisation”). The Programme will end no later than 31 December 2013. The
purpose of the share buy-back is to reduce PANDORAs share capital and to meet
obligations arising from employee share option programmes. The Board of
Directors intends to propose to PANDORAs shareholders at the Annual General
Meeting in 2014 that PANDORAs share capital be reduced by the shares purchased
under the Programme. PANDORA may also use the shares purchased under the
Programme to meet obligations arising from employee share option programmes.
Deducting existing treasury shares (182,925), the net obligation at 31 December
2012 was 925,198 shares.

The Programme is being implemented in accordance with the provisions of the
European Commission’s regulation no. 2273/2003 of 22 December 2003 (“safe
harbour”), which protects listed companies against violation of insider
legislation in connection with share buybacks.

PANDORA has appointed Nordea Bank Danmark A/S (“Nordea”) as Lead Manager of the
Programme. Nordea will, under a separate agreement with the Company, buy back
shares on behalf of PANDORA and make trading decisions in respect of PANDORA
shares independently of and without influence from PANDORA.

PANDORA may terminate the Programme at any time. In the event such decision is
taken, PANDORA shall give notice thereof, and Nordea shall consequently no
longer be entitled to buy shares on behalf of PANDORA.

The majority shareholder, Prometheus Invest ApS, has undertaken to participate
in the Programme on a pro rata basis, in order to secure that the current free
float percentage is not reduced. The participation is planned so that
Prometheus Invest ApS on each day of trading will sell a number of PANDORA
shares at the volume weighted average purchase price of the shares purchased
under the Programme in the market on the relevant day of trading.

The Programme will be implemented under the Authorisation and the following
framework:

-- The maximum total consideration for PANDORA shares bought back in the
period of the Programme is DKK 700 million
-- The Programme will end no later than 31 December 2013 and a maximum of
12,831,400 PANDORA shares will be bought under the Programme, which
together with the Company’s holding of treasury shares of 182,925 shares at
the date of this announcement will equal 10% of the shares issued in
PANDORA
-- The maximum number of shares to be bought per daily market session will be
the
equivalent to 25% of the average daily volume of shares in the C
ompany
traded on NASDAQ OMX Copenhagen during the preceding 20 business days
-- Shares cannot be purchased at prices higher than the two following prices:
1. The price of the latest independent trade
2. The price of the highest independent bid on NASDAQ OMX Copenhagen

On a weekly basis the Company will issue an announcement in respect of
transactions made under the Programme.

CEO Bjørn Gulden, said:

“2012 was a year of re-setting the business. 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 Q3 and Q4
2012.

The new innovative products at commercial prices launched in 2012 have sold in
and out very well. The retailers have reacted very positively to our stock
balancing programme and we can now see that their stock have improved, both in
terms of quality and value compared to a year ago.

The sales-out has improved in all major markets and we are especially pleased
to see the development in Australia and the UK. The US has continued to perform
well. The German market has improved in sales-out but it will take more time
and consistent execution until we improve our sales-in.

The Asian strategic review is continuing, the first result of this being that
we have changed our distributor in Japan.

We are continuing to invest in new markets and have in 2012 seen a very
positive development in markets like Russia, Italy and France.

The results achieved in 2012 is a confirmation of the strength of the PANDORA
brand, our positioning in the segment for branded affordable luxury jewellery –
as well as a solid verification of our highly cash generative business model.
The latter is also the reason why the Board of Directors and Management feel
comfortable with increasing our pay-out ratio significantly at the same time as
we are initiating a share buyback programme up to DKK 700 million in order to
pay back excess cash to our shareholders.”

Annual report 2012 and Q4 financial statement

A full version of PANDORAs Annual Report 2012 has been released today and is
available for download in the investor section of www.pandoragroup.com.

Financial highlights for Q4 2012 are presented as an appendix to this release.

CONFERENCE CALL

A conference call for investors and financial analysts – hosted by CEO Bjørn
Gulden and CFO Henrik Holmark – will be held today at 10.00 CET and can be
accessed from our website: www.pandoragroup.com. The corresponding presentation
will be available on the website one hour before the call.

The following numbers can be used by investors and analysts:

DK: +45 3272 7625

UK (International): +44 (0) 1452 555 566

US: +1 631 510 7498

To help ensure that the conference begins in a timely manner, please dial in 5
minutes prior to the scheduled starting time. Participants will have to quote
confirmation code 97986776 when dialling into the conference.

ABOUT PANDORA
PANDORA designs, manufactures and markets hand-finished and modern jewellery
made from genuine materials at affordable prices. PANDORA jewellery is sold in
more than 70 countries on six continents through over 10,300 points of sale,
including approximately 900 Concept stores.

Founded in 1982 and headquartered in Copenhagen, Denmark, PANDORA employs over
6,000 people worldwide of whom 4,000 are located in Gemopolis, Thailand, where
the company manufactures its jewellery. PANDORA is publicly listed on the
NASDAQ OMX Copenhagen stock exchange in Denmark. In 2012, PANDORAs total
revenue was DKK 6.7 billion (approximately EUR 893 million). For more
information, please visit www.pandoragroup.com.

CONTACT

For further queries, please contact:

INVESTOR RELATIONS MEDIA RELATIONS
Morten Eismark, VP Group Investor Relations Jakob Risom, Press Officer
Phone +45 3673 8213 Phone +45 3673 0634
Mobile +45 3045 6719 Mobile +45 6165 6540

APPENDIX – Q4 2012

HighlightS in q4

GROUP REVENUE WAS DKK 2,174 MILLION. EBITDA MARGIN WAS 24.6%. NET PROFIT WAS
DKK 421 MILLION.

-- Group revenue increased by 11.4% in Q4 2012 (6.9% increase in local
currency) to DKK 2,174 million compared to DKK 1,952 million in Q4 2011:
-- Americas increased by 6.3% (1.5% increase in local currency)
-- Europe increased by 24.0% (20.7% increase in local currency)
-- Asia Pacific decreased by 7.2% (13.4% decrease in local currency)

-- Gross margin decreased to 64.5% in Q4 2012 (compared to a gross margin of
72.7% in Q4 2011) mainly impacted by increasing raw material prices

-- EBITDA margin was 24.6% in Q4 2012 (compared to an EBITDA margin of 26.8%
in Q4 2011), EBITDA increased by 1.9% to DKK 534 million

-- EBIT margin was 22.4% in Q4 2012 (compared to an EBIT margin of 24.3% in Q4
2011), EBIT increased by 2.3% to DKK 486 million

-- Reported net profit decreased by 24.1% to DKK 421 million in Q4 2012
(compared to a net profit of DKK 555 million in Q4 2011). Excluding the CWE
earn-out provision adjustment based on a revised outlook for PANDORA CWE,
Q4 2012 net profit increased by 8.8% to DKK 370 million (compared to an
adjusted net profit of DKK 340 million)

-- Free cash flow was DKK 1.030 million in Q4 2012 (compared to DKK 930
million in Q4 2011)

Revenue development IN Q4 2012

Total revenue increased by 11.4% to DKK 2,174 million in Q4 2012 from DKK 1,952
million in Q4 2011. Revenue was positively impacted by the generation of a
larger proportion of revenue in Owned & Operated stores (including online
revenue), strong revenue development in the UK, Other Europe and Australia as
well as a positive impact from currencies. Revenue was negatively affected by
the development in Germany, delivery of Valentine’s Day collection in Q1 2013
instead of historically in the fourth quarter and a provision for buying back
inventory in connection with the change of distributor in Japan.

Excluding foreign exchange movements, revenue increased by 6.9% consisting of
price decreases
(-3.8 percentage point), volume (14.1 percentage point), market mix (1.3
percentage point) and mix effects (-4.7 Percentage point).

The geographical distribution of revenue in Q4 2012 was 43.2% for the Americas
(45.2% in Q4 2011), 44.4% for Europe (39.9% in Q4 2011) and 12.4% for Asia
Pacific (14.9% in Q4 2011).

Based on data from Concept stores, which have been operating for 12 months or
more, like-for-like sales-out in PANDORAs four major markets have experienced a
positive development in Q4 2012, which PANDORA believes is due to the success
of new innovative products launched and generally better execution in stores
during 2012.

REVENUE BREAKDOWN BY GEOGRAPHY

On 21 February 2012, PANDORA initiated a one-off, time limited stock balancing
campaign with the aim to improve the quality of the stock at its key retail
partners. The campaign has now been successfully completed.

During Q4 2012 PANDORA received discontinued products with a wholesale value of
DKK 0 million and, products worth DKK 10 million were replaced with new
bestsellers. For 2012 the numbers totalled DKK 609 million and DKK 609 million,
respectively.

In order to reduce the risk of slow moving excess stock at retailers going
forward, PANDORA has implemented a number of initiatives. The more frequent and
smaller drops of new product launches should reduce the risk related to excess
stock at retail. Additionally, the ability to more closely monitor daily
sales-out development at SKU level from Concept stores will provide earlier
insight into non-performing items with a possibility to ensure a better balance
between sales-in and sales-out and thereby reduce the risk of excess stock at
retailers.

Going forward, when PANDORA discontinues products, two main avenues will be
pursued in order to address discontinued stock at retailers. One is to
introduce sales campaigns on discontinued items twice a year and to clear items
through online as well as offline outlet channels. A second avenue is to take
back discontinued stock from retailers and on an on-going basis to take a
provision for returns of discontinued items in markets where returns of
products from customers are customary. These options are applied differently in
the various geographical regions.

Generally in the Americas, PANDORA currently takes back stock from retailers
and are, starting in Q4 2012, actively announcing to retailers when items are
discontinued. Other regions, as a general rule, pursue sales campaigns or
clearance through outlet channels.

Based on the experience from promoting return policies towards retailers when
conducting our stock balancing campaign in 2012 and the fact that PANDORA now
actively communicate to retailers when products are discontinued, PANDORA has
decided to provision DKK 416 million for returns (DKK 225 million in 2011) in
the 2012 annual accounts (refer to note 21 in PANDORA Annual Report 2012), with
a corresponding impact on gross margin. The revenue impact of the provision
corresponds to 9% of Group revenue in 2012 compared to 5% in 2011.

AMERICAS

Revenue in Americas increased by 6.3% to DKK 939 million in Q4 2012 from DKK
883 million in Q4 2011. Excluding foreign exchange movements, the revenue
increased by 1.5% compared to Q4 2011.

In the United States (accounting for 34.0% of Q4 2012 Group revenue) revenue
was up 5.3% in Q4 2012 versus Q4 2011 (an increase of 0.8% measured in local
currency).

Based on Concept stores, which have been operating for 12 months or more, like-
for-like sales-out in the US increased by 6.9% in Q4 2012 compared to Q4 2011.

Other Americas sales were up 10.4% and now constitute 9.3% of Group revenue,
with Canada as the largest contributor.

During Q4 2012 the number of branded stores in the Americas increased by 67
stores (versus 137 branded stores in Q4 2011 and 81 branded stores in Q3 2012)
to a total of 1,572 stores. Branded stores accounted for 48.5% of the total
number of stores compared to 47.4% at the end of Q3 2012.

EUROPE

In Europe, PANDORA experienced an increase in revenue of 24.0% (an increase of
20.7% in local currency) in Q4 2012 versus Q4 2011, driven by the UK and Other
Europe.

Revenue in the UK, our largest single European market (accounting for 17.7% of
Q4 2012 Group revenue) increased by 11.6% (5.0% increase measured in local
currency).

Based on Concept stores which have been operating for 12 months or more,
like-for-like sales-out in the UK increased by 12.3% in Q4 2012 compared to Q4
2011.

Revenue in Germany, PANDORAs second largest market in Europe (accounting for
7.1% of Q4 2012 Group revenue), decreased 16.3% in Q4 2012 compared to Q4 2011.
While many initiatives have been activated in Germany and sales-out of Concept
stores has improved, it will, as previously announced, take time before
initiatives impact PANDORAs revenue.

Based on Concept stores, which have been operating for 12 months or more,
like-for-like sales-out in Germany, increased by 4.5% in Q4 2012 compared to Q4
2011.

The category Other Europe increased by 70.5% in Q4 2012 compared to Q4 2011,
positively affected by Russia, Spain and Italy.

During Q4 2012 the number of branded stores in Europe increased by 206 stores
to a total of 2,409 stores, accounting for 37.0% of the total number of stores
compared to 34.2% at the end of Q3 2012.

ASIA PACIFIC

In Asia Pacific, revenue decreased 7.2% in Q4 2012 compared to Q4 2011.
Excluding currency movements, the underlying revenue in the region decreased by
13.4% year on year. Revenue development was positively impacted by strong
performance in Australia but more than offset by a negative one-off effect from
buying back inventory in connection with the change of distributor in Japan.

Reported revenue in Australia (accounting for 11.2% of Q4 2012 Group revenue)
was up 15.7% year on year whereas revenue increased 7.9% in local currency. In
Australia PANDORA experienced a positive trend in both sales-in and sales-out
driven by changes to the distribution network as well as the success of new
innovative products launched during 2012.

Based on Concept stores which have been operating for 12 months or more,
like-for-like sales-out in Australia increased by 10.1% in Q4 2012 compared to
Q4 2011.

In the category Other Asia Pacific, constituting 1.2% of total Group revenue,
revenue was down by 67.5% in Q4 2012 compared to the same quarter last year.

PANDORA has terminated its arrangements with its former Japanese distributor,
Vérité Co. Ltd. and simultaneously entered into an agreement with Bluebell
Japan Limited.

The termination of the agreement with Vérité will initially lead to store
closures in Japan in a transition period which had also lead PANDORA to
provision for taking back inventory from Vérité Co. Ltd, worth DKK 38 million
with a corresponding negative impact on the revenue line in Other Asia in Q4
2012.

Excluding this effect, Other Asia revenue decreased by 20.0% in Q4 2012
compared to Q4 2011, the decline is mainly explained by fewer store openings
and weaker sales-in in Q4 2012 compared to Q4 2011.

pandora sales channels

Direct distribution accounted for 96.2% of revenue in Q4 2012 compared to 97.3%
in Q4 2011. Branded sales in markets with direct distribution accounted for
82.3% in Q4 2012 (80.2% in Q4 2011). Concept stores accounted for 57.1% of the
branded sales in Q4 2012 (59.5% in Q4 2011).

Branded stores in direct distribution markets accounted for 45.7% of the total
number of stores at the end of Q4 2012 compared to 36.5% at the end of Q4 2011.

Total number of points of sale increased by 154 in Q4 2012 compared to Q3 2012
to a total of 10,374 globally. In the same period, PANDORA added a net total of
297 branded points of sale. Of these, 72 were Concept stores, 61 were
Shop-in-Shops and 164 were Gold stores.

product offering

In Q4 2012 revenue from Charms increased by 15.1% compared to Q4 2011. Revenue
from Silver and gold charms bracelets decreased by 0.7% compared to Q4 2011.
The two categories represented 84.0% of total revenue in Q4 2012 compared to
83.3% in Q4 2011.

Rings increased by 18.4%, as a result of a more commercial offering compared to
last year’s assortment. Rings represented 6.2% of total revenue compared to
5.8% in Q4 2011. Other Jewellery decreased by 0.5%. Other Jewellery represented
9.8% of total revenue compared to 10.9% in Q4 2011.

The average sales price per item in Q4 2012 has decreased to DKK 132 from DKK
136 in Q4 2011 mainly driven by lower price points on new product introductions
and general price reductions during 2012 partially offset by positive currency
movements.

NeW markets

In Q4 2012, PANDORA has succeeded in opening 30 Concept stores in PANDORAs key
new markets (Italy, France, Russia and Asia), bringing net openings to 80 in
2012.

PANDORAs strategy in Russia, China and Japan is to primarily open branded
stores - mainly Concept stores and Shop-in-Shops.

PANDORAs strategy in Italy is to utilise the large and well-established network
of multi-brand jewellery retailers. In Italy, the Company was selling PANDORA
products through 972 points of sale (13 Concept store, 8 Shop-in-Shops, 255
Gold stores, 313 Silver stores and 383 White stores) at the end of Q4 2012.

Our strategy in France is to upgrade the quality of our distribution network
since we took over the distribution in France from our former 3rd party
distributor on 1 July 2011, with a particular emphasis on department store
Shop-in-Shops and Concept stores. In France, the Company was selling PANDORA
products through 298 points of sale (12 Concept stores, 30 Shop-in-Shops, 13
Gold store, 136 Silver stores and 107 White stores) at the end of Q4 2012.

GROSS PROFIT AND GROSS MARGIN

Gross profit was DKK 1,403 million in Q4 2012 compared to DKK 1,420 million in
Q4 2011, resulting in a gross margin of 64.5% in Q4 2012 compared to 72.7% in
Q4 2011.

The average realised price for gold was 1,690 USD/oz and 31.62 USD/oz for
silver in Q4 2012.

Compared with Q4 2011 the Q4 2012 gross margin was negatively impacted by
increasing raw material prices (-7.1 percentage point), price changes (-1.1
percentage point), product and market mix (1.3 percentage point) and currencies
(-1.3 percentage point). Product and market mix includes approximately a one
percentage point negative impact on gross margin due to the expiration of the
suspension of certain import duties of goods manufactured in Thailand under the
U.S. Generalized System of Preferences program.

Compared with Q3 2012, the Q4 2012 gross margin increase is explained by
increasing raw material prices (-1.4 percentage point), price changes (0.0
percentage point), product and market mix (-1.6 percentage point) and
currencies (3.4 percentage point).

It is PANDORAs policy to hedge 100%, 80%, 60% and 40% of expected gold and
silver consumption in the following four quarters. Our hedged prices for the
following four quarters for gold are 1,677 USD/oz, 1,646 USD/oz, 1,753 USD/oz,
1,730 USD/oz and for silver 33.16 USD/oz, 30.78 USD/oz, 32.64 USD/oz and 31.94
USD/oz. However, current inventory means a delayed impact of these hedge prices
on our cost of goods sold. The combined effect of the time lag from inventory
and the 12-month rolling hedges effectively means that PANDORA is already
hedged into H2 2013.

Excluding our hedging and the time lag effect from our inventory, the
underlying gross margin would have been approximately 65.0% based on average
gold (1,718 USD/oz) and silver (32.57 USD/oz) market prices in Q4 2012. Under
the same assumptions, a 10% deviation in quarterly average gold and silver
prices would impact our gross margin by approximately +/- 2-3 percentage
points.

DISTRIBUTION EXPENSES

Distribution expenses were DKK 686 million in Q4 2012 compared to DKK 699
million in Q4 2011, representing 31.5% of revenue in Q4 2012 compared to 35.8%
in Q4 2011.

Sales and distribution expenses increased to DKK 393 million in Q4 2012 from
DKK 307 million in Q4 2011, representing 18.1% of revenue in Q4 2012 compared
to 15.7% Q4 2011. The increase is mainly caused by entry into new markets as
well as an increase in PANDORA-owned Concept stores and Shop-in-Shops in Q4
2012 compared to Q4 2011 (167 and 136, respectively).

Marketing expenses decreased to DKK 293 million in Q4 2012 from DKK 392 million
in Q4 2011, corresponding to 13.4% of revenue in Q4 2012, compared to an
unusually high level of 20.1% in Q4 2011.

ADMINISTRATIVE EXPENSES

Administrative expenses amounted to DKK 231 million in Q4 2012 versus DKK 246
million Q4 2011, representing 10.6% of revenue in Q4 2012, down from 12.6% of
Q4 2011 revenue.

Cost ratios

Please note that the cost ratios for 2012 are affected by the negative impact
on revenue from the stock balancing campaign.

EBITDA

EBITDA for Q4 2012 increased by 1.9% to DKK 534 million resulting in an EBITDA
margin of 24.6%, down from 26.8% in Q4 2011.

Regional EBITDA margins for Q4 2012 before allocation of central costs were
36.0% in Americas (46.1% in Q4 2011), 26.8% in Europe (34.9% in Q4 2011) and
31.2% in Asia Pacific (33.4% in Q4 2011). Unallocated costs decreased to minus
6.8% in Q4 2012 compared to minus 12.9% in Q4 2011.

EBITDA margins in all regions are significantly affected by the lower gross
margin reported in Q4 2012. The Americas region EBITDA margin is lower than
last year, additionally affected by the expiration of the suspension of certain
import duties of goods manufactured in Thailand under the U.S. Generalized
System of Preferences program. The margin decrease in Europe is furthermore
affected by the costs related to the development of direct operations in Italy
and France. The decrease in EBITDA margin in Asia Pacific is impacted by the
provision for inventory take back in Japan which is only partially offset by an
increase in revenue in Australia.

EBIT

EBIT for Q4 2012 increased to DKK 486 million – an increase of 2.3% compared to
the same quarter 2011, resulting in an EBIT margin of 22.4% for Q4 2012 versus
24.3% in Q4 2011.

NET FINANCIAL INCOME AND EXPENSES

Net financial income amounted to DKK 40 million in Q4 2012 against net
financial income of DKK 145 million in Q4 2011.

Financial income is positively affected by DKK 51 million from adjustment of
the CWE earn-out provision based on the revised outlook for PANDORA CWE. While
the Italian market has developed positively compared to expectations, Germany,
although showing positive signs, has not developed fully in accordance with
expectations which impact the forecasted value of the earn-out liability
related to CWE. Following this adjustment the balance sheet no longer includes
a provision for the CWE earn-out.

INCOME TAX EXPENSES

Income tax expenses were DKK 105 million in Q4 2012, implying an effective tax
rate of 20.0% for Q4 2012 compared to 10.5% for Q4 2011.

net profit

Net profit in Q4 2012 decreased by 24.1% to DKK 421 million from DKK 555
million in Q4 2011. Excluding the CWE earn-out provision adjustment, Q4 2012
net profit increased by 8.8% to DKK 370 million (compared to an adjusted net
profit of DKK 340 million in Q4 2011).

LIQUIDITY AND CAPITAL RESOURCES

In Q4 2012, PANDORA generated free cash flow of DKK 1,030 million corresponding
to a cash conversion of 244.7% compared to 167.6% in Q4 2011. The increase in
cash conversion is driven by an improvement in our cash flow, primarily due to
a reduction in inventory levels in Q4 2012.

Operating working capital (defined as inventory and accounts receivables less
accounts payables) at the end of Q4 2012 was 30.7% of preceding twelve months
revenue compared to 33.4% at the end of Q4 2011 and 42.5% at the end of Q3
2012.

Inventory decreased significantly to DKK 1,318 million at the end of Q4 2012
from DKK 1,609 million at the end of Q3 2012 and decreased by DKK 604 million
versus Q3 2012. The significant decrease in inventory level from Q3 2012 to Q4
2012 can be explained by improved inventory management and remelting of
obsolete inventory from the 2012 stock balancing campaign totalling DKK 135
million, which have countered the soaring gold and silver prices (increased
approximately 20%).

Trade receivables decreased to DKK 940 million in Q4 2012 (14.1% of preceding
12 month revenue) from DKK 982 million in Q3 2012 (15.3% of preceding 12 month
revenue) due to seasonal effects and extended terms on Christmas orders in Q3
2012.

In Q4 2012, PANDORA invested a total of DKK 67 million in property, plant and
equipment, approximately 3.1% of revenue. The increase in investments in Q4
2012 was related to our factory in Thailand moving forward investments in the
Innovation & Design Centre at PANDORAs production facilities in Gemopolis,
Thailand.

Total interest-bearing debt was DKK 158 million at the end of Q4 2012 (compared
to DKK 385 million at the end of Q4 2011).

Cash and short-term deposits amounted to DKK 341 million at the end of Q4 2012
(compared to DKK 176 million at the end of Q4 2011).

Net interest-bearing debt at the end of Q4 2012 was DKK -183 million
corresponding to -0.1 LTM EBITDA (compared to DKK 209 million at the end of Q4
2011 corresponding to 0.1 LTM EBITDA).

Management statement

The Board of Directors and the Executive Board have reviewed and approved the
interim report of PANDORA A/S for the period 1 January – 31 December 2012.

The interim report, which has not been audited or reviewed by the Company's
auditor, has been prepared in accordance with IAS 34 “Interim Financial
Reporting”, as adopted by the EU, and additional Danish interim reporting
requirements for listed companies.

In our opinion, the interim report gives a true and fair view of the PANDORA
Group’s assets, liabilities and financial position at 31 December 2012, and of
the results of the PANDORA Group’s operations and cash flow for the period 1
January – 31 December 2012.

Further, in our opinion the Management's review (p. 1-17) gives a true and fair
review of the development in the Group's operations and financial matters, the
result of the PANDORA Group for the period and the financial position as a
whole, and describes the significant risks and uncertainties pertaining to the
Group.

Copenhagen, 26 February 2013

Executive BOARD

Björn Gulden Henrik Holmark
Sten Daugaard

Chief Executive Officer Chief Financial Officer
Chief Development Officer

Board of directors

Allan Leighton
Marcello V. Bottoli

Chairman

Andrea Alvey
Anders Boyer-Søgaard

Christian Frigast
Torben Ballegaard Sørensen

Nikolaj Vejlsgaard
Ronica Wang

Notes

NOTE 1 – Significant accounting estimates and judgements

In preparing the consolidated financial statements, management makes various
accounting estimates and assumptions, which form the basis of presentation,
recognition and measurement of PANDORAs assets and liabilities.

All significant accounting estimates and judgements are consistent with the
description in the Annual Report for 2012. We refer to the description in note
1 of the consolidated financial statement in PANDORAs Annual Report for 2012.

NOTE 2 – Seasonality of operations

Due to the seasonal nature of the jewellery business, higher revenue are
historically realised in the second half of the year.

NOTE 3 - Operating segment information

PANDORAs activities are segmented on the basis of geographical areas in
accordance with management’s reporting structure. In determining the reporting
segments, a number of operating segments have been aggregated. All segments
derive their revenues from the types of products shown in the product
information provided below.

Management monitors the segment profit of the operating segments separately for
the purpose of making decisions about resource allocation and performance
management. Segment profit is measured consistently with the operating profit
in the consolidated financial statements before non-current assets are
amortised/depreciated (EBITDA).

NOTE 4 - Contingent liabilities

PANDORA is a party to a number of minor legal proceedings, which are not
expected to influence PANDORAs future earnings.

NOTE 5 – Related party transactions

Related parties of PANDORA with a controlling interest are the principal
shareholder Prometheus Invest ApS (50.49% interest) and the ultimate parent,
Axcel III K/S 2 (32.34% interest).

Related parties further comprise Axcel III K/S 2’s other portfolio enterprises,
as they are subject to the same controlling interests. There have not been any
transactions with Axcel III K/S 2 or its portfolio enterprises during 2012 and
2011.

Related parties of PANDORA with significant interests include the Board of
Directors and the Executive Board of the companies and their close family
members. Furthermore, related parties include companies in which the
aforementioned persons have control or significant interest.

Except for compensation and benefits received as a result of the membership of
the Board of Directors, employment with PANDORA or shareholdings in PANDORA,
PANDORA has not undertaken any significant transactions with the Board of
Directors and Executive Management. We refer to the description in note 23 of
the consolidated financial statement in PANDORAs Annual Report for 2012.

There have been no other transactions than dividends between PANDORA and
Prometheus Invest ApS during 2012 and 2011.

NOTE 6 – Accounting policies

The present unaudited interim financial report has been prepared in accordance
with IAS 34 ‘Interim Financial Reporting’ and accounting policies set out in
the Annual Report 2011 of PANDORA. Furthermore, the interim financial report
and Management’s review are prepared in accordance with additional Danish
disclosure requirements for interim reports of listed companies. PANDORA has
adopted all new, amended or revised accounting standards and interpretations
(‘IFRS’) endorsed by the EU effective for the accounting period beginning on 1
January 2012. These IFRSs have not had any significant impact on the Group’s
interim financial report.

QUARTERLY OVERVIEW

Disclaimer

Certain statements in this company announcement constitute forward-looking
statements. Forward-looking statements are statements (other than statements of
historical fact) relating to future events and our anticipated or planned
financial and operational performance. The words “targets,” “believes,”
“expects,” “aims,” “intends,” “plans,” “seeks,” “will,” “may,” “might,”
“anticipates,” “would,” “could,” “should,” “continues,” “estimate” or similar
expressions or the negatives thereof, identify certain of these forward-looking
statements. Other forward-looking statements can be identified in the context
in which the statements are made. Forward-looking statements include, among
other things, statements addressing matters such as our future results of
operations; our financial condition; our working capital, cash flows and
capital expenditures; and our business strategy, plans and objectives for
future operations and events, including those relating to our ongoing
operational and strategic reviews, expansion into new markets, future product
launches, points of sale and production facilities; and

Although we believe that the expectations reflected in these forward-looking
statements are reasonable, such forward-looking statements involve known and
unknown risks, uncertainties and other important factors that could cause our
actual results, performance or achievements or industry results, to differ
materially from any future results, performance or achievements expressed or
implied by such forward-looking statements. Such risks, uncertainties and other
important factors include, among others: global and local economic conditions;
changes in market trends and end-consumer preferences; fluctuations in the
prices of raw materials, currency exchange rates, and interest rates; our plans
or objectives for future operations or products, including our ability to
introduce new jewellery and non-jewellery products; our ability to expand in
existing and new markets and risks associated with doing business globally and,
in particular, in emerging markets; competition from local, national and
international companies in the United States, Australia, Germany, the United
Kingdom and other markets in which we operate; the protection and strengthening
of our intellectual property, including patents and trademarks; the future
adequacy of our current warehousing, logistics and information technology
operations; changes in Danish, E.U., Thai or other laws and regulation or any
interpretation thereof, applicable to our business; increases to our effective
tax rate or other harm to our business as a result of governmental review of
our transfer pricing policies, conflicting taxation claims or changes in tax
laws; and other factors referenced in this company announcement.

Should one or more of these risks or uncertainties materialize, or should any
underlying assumptions prove to be incorrect, our actual financial condition,
cash flows or results of operations could differ materially from that described
herein as anticipated, believed, estimated or expected.

We do not intend, and do not assume any obligation, to update any
forward-looking statements contained herein, except as may be required by law
or the rules of NASDAQ OMX Copenhagen. All subsequent written and oral
forward-looking statements attributable to us or to persons acting on our
behalf are expressly qualified in their entirety by the cautionary statements
referred to above and contained elsewhere in this company announcement.