Jeweller Pandora Cuts Ties with Leading Industry Body over Russia

A Pandora store, the international Danish jewellery manufacturer and retailer, is seen in Paris, France, August 7, 2018. REUTERS/Benoit Tessier
A Pandora store, the international Danish jewellery manufacturer and retailer, is seen in Paris, France, August 7, 2018. REUTERS/Benoit Tessier
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Jeweller Pandora Cuts Ties with Leading Industry Body over Russia

A Pandora store, the international Danish jewellery manufacturer and retailer, is seen in Paris, France, August 7, 2018. REUTERS/Benoit Tessier
A Pandora store, the international Danish jewellery manufacturer and retailer, is seen in Paris, France, August 7, 2018. REUTERS/Benoit Tessier

Jewelry maker Pandora said on Wednesday it had decided to leave the Responsible Jewellery Council (RJC) after the industry body failed to cut ties with Russia.

The RJC, which sets ethical standards for the jewellery and watch industry and whose members include Richemont's Cartier and Tiffany & Co, has failed to suspend Russian companies or urge its members to halt business in the country following its invasion of neighboring Ukraine, Pandora said.

"The war requires all businesses to act with the utmost responsibility regarding any interactions or business dealings with Russia and Belarus," Chief Executive Alexander Lacik said in a statement.

"Pandora cannot in good faith be a member of an association that does not share our values," he added.

RJC was not immediately available for comment.

Russia's state-owned Alrosa, the world's largest diamond producer, stepped down voluntarily from the RJC's board earlier this month but is still listed as a member and as having a RJC certification on the trade association's web page.

Alrosa was last week put on the UK sanctions list and Washington has targeted both the company and its CEO Sergei Ivanov, who, the US Treasury said, is reportedly one of Russian President Vladimir Putin's closest allies.

The RJC said earlier this month it was "saddened by the geopolitical situation in connection with the Ukraine crisis" and that it would continue to monitor the situation "in accordance with international regulations and update its members with guidance as it evolves".

Pandora has suspended all business with Russia and Belarus following what the Kremlin calls a "special military operation" in Ukraine.



Nike Trips as Forecast of Another Sales Decline Dims Quick Turnaround Hopes 

Nike shoes are seen displayed at a sporting goods store in New York City, New York, US, May 14, 2019. (Reuters)
Nike shoes are seen displayed at a sporting goods store in New York City, New York, US, May 14, 2019. (Reuters)
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Nike Trips as Forecast of Another Sales Decline Dims Quick Turnaround Hopes 

Nike shoes are seen displayed at a sporting goods store in New York City, New York, US, May 14, 2019. (Reuters)
Nike shoes are seen displayed at a sporting goods store in New York City, New York, US, May 14, 2019. (Reuters)

Nike shares slipped nearly 6% premarket on Friday after the sportswear giant warned of another quarter of sales decline, leaving some investors worried about the pace of a crucial turnaround under new CEO Elliott Hill.

The company on Thursday forecast a steeper-than-expected drop in fourth-quarter revenue and also reported a 17% slump in China quarterly sales amid weaker discretionary spending in the country.

Hill - who took on the role in October to help the sportswear maker regain lost market share - has laid out what he called a "Win Now" strategy, which includes boosting on-the-ground presence in five key cities including Shanghai and Beijing.

"It is too early to be confident in the turnaround," Sheraz Mian, director of research at Zacks Investment Research, said.

The new management will take time to rebuild relations with other retailers that were weakened by its focus on selling directly via its stores and website and develop a more compelling line of products, he said.

Nike shares are down about 11% since Hill's CEO announcement in September, giving up all the gains following his appointment.

To be sure, Hill has fast-tracked certain sneaker launches such as Pegasus premium and Vomero 18 that helped lift sales in the reported third quarter. Still, Nike is working to move past the previous management's strategy missteps that led to a lack of innovation for its product lines.

Nike's Chief Financial Officer Matthew Friend said the company would take "several quarters" to clear out its dated stock, which would involve margin-hitting discounts.

"Nike is emerging from quite a deep hole from prior management in terms of excess inventory, lack of innovation and brand equity, which we expect will take multiple seasons to correct," Barclays analyst Adrienne Yih said.

Analysts at Barclays also projected that the earliest they foresee a turnaround is in the second half of Nike's fiscal year ending May 2026.

The company's forward price-to-earnings ratio for the next 12 months, a benchmark for valuing stocks, was 30.08, compared with 17.33 for Deckers and 25.91 for Adidas.

"We continue to like the recovery story but don't expect to see much short-term progress," Bernstein analysts said.