Pandora — M&A Activity 2015

Jan 5, 2015

PANDORA's reset strategy for Germany has been to focus on creating the optimum
refreshed network through expansion of concept stores in quality locations. In
a quantum leap of that strategy, the Company has today entered into an
agreement with DHG Gmbh (DHG) to assume up to 78 commercial leaseholds in
Germany currently trading under the BiBa name (a ladies fashion brand) by the
31st January 2015, when negotiations with landlords are expected to be
finalised.

PANDORA will pay a service fee to DHG for making the leaseholds available to
PANDORA. The amount of this fee will be dependent on the number of leases
successfully assigned.

Allan Leighton, CEO at PANDORA, said: “We have carefully mapped the German
market, in terms of how an ideal concept store network would look in the
country. With this agreement, we have now in one strategic move gained
immediate access to a very large proportion of the desired locations.”

Niels Møller, President PANDORA Central Western Europe, said: “This will be a
significant strategic step for PANDORA in Germany, which accelerates our
strategic plan for this market.“

All commercial leaseholds concern stand-alone stores all located at prime
locations in Germany fitting well into PANDORA’s existing concept store
expansion strategy in Germany. PANDORA will in the coming year open owned and
operated concept stores in the new locations, some of which will be a
relocation of already existing PANDORA owned stores. A number of these stores
over time may move back to franchise stores, as PANDORA’s operations in Germany
strengthens.

The total investment for the new O&O stores, including establishment and
relocation of stores (including initial stock in the stores), costs related to
temporarily inactive stores in the transition period, service fees to DHG as
well as all other costs related to the store implementation, is expected to be
around EUR 50 million (approx. DKK 370 million), of which the majority will be
booked as CAPEX and inventory. The amount will be spent over the course of
2015. The impact from the transaction on revenue and EBITDA in 2015 is expected
to be limited due to the gradual roll-out of the stores.

Germany is one of PANDORA’s core markets and generated revenue of DKK 372
million in the first nine months of 2014, corresponding to an increase of 8.1%
compared to the same period in 2013. As of today, PANDORA owns and operates 61
concept stores in Germany out of a total of 83 concept stores in the country.
The German jewellery market is one of the largest in Europe and in 2013 had a
value of EUR 3.9 billion (approx. DKK 29 billion)[1].

The content of this release will have no impact on PANDORA's outlook for 2014,
as latest communicated to the market in Company Announcement No.202.

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 80 countries on six continents through approximately 9,800 points of
sale, including more than 1,300 concept stores.

Founded in 1982 and headquartered in Copenhagen, Denmark, PANDORA employs more
than 11,000 people worldwide of whom approximately 7,800 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
2013, PANDORA’s total revenue was DKK 9.0 billion (approximately EUR 1.2
billion). For more information, please visit www.pandoragroup.com.

CONTACT
For more information, please contact:

INVESTOR RELATIONS MEDIA RELATIONS
Morten Eismark Jakob Risom Langelund
VP Group Investor Relations Press Officer
Phone +45 3673 8213 Phone +45 3673 0634
Mobile +45 3045 6719 Mobile +45 6165 6540
Magnus Thorstholm Jensen
Investor Relations Officer
Phone +45 4323 1739
Mobile +45 3050 4402

[1]Euromonitor 2014