Pandora Stock

Good morning, everyone, and welcome to the conference call for Pandora's Q2 2026 Results. I'm Bilal Aziz from the Investor Relations team, and I'm joined here by our CEO, Berta de Pablos-Barbier; CFO, Anders Boyer, and the rest of the IR team. As usual, there will be a Q&A session at the end of the call. If you could limit yourself to 2 questions, that would be great.

Please pay notice to the disclaimer on Slide 2 and then turn to Slide 3, and I will hand over to Berta.

Thank you, Bilal, and welcome, everyone. I would like to start with a small reminder and providing some context that 2026 is a year of deliberate change for Pandora. We are rolling our new growth model with greater focus on distinctive design, cultural relevance and a stronger local execution. Now in addition, we are also expanding our retail experience with some pilots intending to inspire discovery and giving the consumers more reasons to buy. We will be scaling across markets as we see proof points that is working.

And importantly, we are also improving the quality of growth, substantially reducing promotions and heavy discounting. And you can see this implemented particularly in our core markets. Now all these actions, of course, are intending to strengthen brand desirability and relevance and to build a healthier platform for sustainable growth. I will expand a little bit later, and you'll be able to see some examples.

But with all that, let me turn to quarter 2. Quarter 2 played out broadly as we expected. We delivered 1% like-for-like growth and 3% organic growth. Growth in this quarter reflects a deliberate reduction in promotional activity, particularly in core markets. So of course, it has moderated growth in the near term, but it is the right choice for both the health of the brand and the quality of our growth. Profitability remained strong. EBIT margin benefit from the refund of previously paid U.S. tariffs. But even if we actually through this effect, the business has continued to demonstrate a disciplined cost control and very resilient profitability. And finally, our returns remain high at close to 40% despite the external environment.

Let's now move to the next slide, please. I would like to turn to guidance now. We have adjusted both our top line and EBIT margin guidance for the year. Now for the top line, we are now targeting an organic growth of 0% to plus 3%. And the main change on this guidance is actually our like-for-like growth, which we are now increasing to minus 2% to plus 1% and this compares to the previous minus 3% to 0% on like-for-like. Now why this upgrade? Well, this upgrade reflects our performance in the first half of the year. But at the same time, we have to be careful because we continue to operate in a volatile macroeconomic and geopolitical environment. So -- and the implications for consumer still remain uncertain.

Now on EBIT margin, the upgrade of our guidance to '22 to '23 -- from '22 to '23 compared to the '21-'22 previously. Andres will be taking you through the guidance in a little bit more detail shortly. Now let me talk a little bit about current trading. The like-for-like growth in the quarter so far has been around mid-single-digit levels. Of course, they has benefit from the timing of our end-of-season sale, which was more weighted towards July this year versus June last year. But I want to be very clear, while we start the quarter and the quarter -- the beginning is encouraging, July is not representative of the underlying run rate of the business. So it should not be extrapolated forward. It is important to keep this thing in perspective.

Now let's get into more detail on the quarter 2 performance drivers, if you can pass to the next slide, please. Now quarter 2, we delivered a 1% like-for-like growth. And you can see the split between the core and the few with more on this slide. Now the way to read this result is where we have distinctive product newness with high-impact activation, we are driving growth. In other areas, there is more work to do and actions to put this in place are starting with high focus, of course, on our core business. Core delivered minus 1% like-for-like growth in line with Q1. The growth in the core continued to be supported by the strong performance of the collection launched last year, Talisman.

Now in moments, our playful aesthetic, the opportunity is still there to bring a stronger, more distinctive newness. And as I said before, this is where all our focus is now. Now in filled with more, where we have higher mix of distinctive design, we delivered 3% like-for-like growth. And that performance was very supported by Timeless, which our new Garden of drinks collection and Pandora Essence.

Let's go into the next slide to talk about markets. Our regional performance in quarter 2 remained mixed. Let me start with the EMEA region, which is our largest region. There, we delivered a like-for-like growth of minus 2%. Now Spain, Poland, Portugal continue to perform very well, and that was offset by weak performance in some of our mature markets like Italy and the U.K. Now growth in these markets, Italy and U.K., reflects, as I mentioned, a significant reduction in promotional days versus last year.

In these markets, in addition to implementing the new growth model, we are also piloting and evolve retail experience with a clear objective of strengthen desirability, inspire discovery and give consumers more reasons to buy Pandora. We are bringing collections into curated looks, elevating the product presentation and strengthening visual storytelling. Early signs are encouraging, and we will continue to refine and scale what works.

Now in the U.S., our largest market, the like-for-like growth was flat in the quarter. Our performance continued to be impacted by softer consumer sentiment and lower store traffic. But against this backdrop, the brand remains healthy and strong, and we continue to focus on what we can control, strengthening demand creation through more impactful brand activation and locally relevant execution. So overall, for the region, North America, there was a stable growth around minus 1%.

In Latin America, our like-for-like growth accelerated to 18%. The price repositioning that we introduced earlier this year continues to deliver strong results. This is supported by a strong local activation and influence engagement, which I'll touch a little bit more later as well. And finally, in Asia, we delivered a strong growth of 10%. Our rollout in Japan continues to progress very well, and we still remain in the early stage of building that brand awareness, that reach through continued increased marketing investment.

Now let me show some examples of what do we mean by our new growth model is coming to life to drive demand. If we can go to the next slide. I did mention last quarter that we have started to rebalance our marketing investment and the introduction of the Garden of Dreams campaign is a good example of this shift in action. The campaign basically brought together some of our most distinctive designs of the season with a stronger, more focused amplification across touch points, events, influencers.

You can see some examples in the picture. And this reinforce a point that I made last quarter. When we bring a strong product design and marketing that is relevant, they work hand-in-hand and deliver growth. So this absolutely translated into growth across all markets, and you can see that reflected in the strong performance of the Timeless collection and therefore, our fuel with more segment in this quarter.

Let's go to another example on the next slide. You can see here as well how we are bringing our new growth model to life. Following the success of Bridgerton in quarter 1, in July, we launched Pandora Wonders, a multiyear creative platform that is designed to build desirability and drive demand through design, craftsmanship and cultural relevance.

Now our first action was co-created with Harry Lambert and was launched during Paris Couture Week. And this is exactly what we want to do more. It is really create cultural moments for Pandora. It's bringing Pandora into the cultural conversation. through distinctive design and high-impact activations. Now this campaign was launched in key markets. It's early, but response has been very strong, particularly on our earned media and PR coverage. So it is encouraging and that we are seeing as well the first sign of early engagement from new customers coming to the brand and being attracted by the Pandora brand.

Now what matters most is the long-term opportunity of this platform as this year, we will bring a new creative voice to play and reinterpret our materials and our craftsmanship through limited edition capsules. Of course, you will hear more of how this campaign performed on the quarter 3, which we will have the entire KPIs.

Let's go now into the next slide, please. Now of course, we do continue to invest on our store network, both expanding our footprint, but most importantly or equally important, elevating the experience of our existing stores. So we do continue to roll out our digital screens, our store facade, which is allowing us to bring the collections and the brand storytelling to life with much greater impact.

Now during the quarter, we opened new flagship stores in Barcelona and Milan. And these stores is a good opportunity to bring together the full breadth and inspiration of Pandora and set a new benchmark of how consumers experience the brand. I really encourage you if you find yourself in either city to visit some of the stores as you will see and understand better what the great expression of Pandora can be on the brand experience.

Now let's go to the next slide. I'm just going to bring everything I have just saying together by reminding the direction that we set out in February. You will recognize this slide. You have seen some concrete examples of how this is now coming to life, more design-led newness, more effective marketing and a stronger locally relevant execution. As you see, Garden of Dreams show that and brought that into practice and also prove that we have opportunity to get Pandora into new categories, neckless, rings, et cetera, where you know we have still opportunity to grow.

So these actions are in motion. We are seeing encouraging proof points, but they are not yet fully reflected in the performance of the business today. So as I said, 2026 is a deliberate year of change. We're bringing more discipline and scaling what works. You will hear more on the quarter 3, where we are bringing together a strategic update, but now we can go into the next slide.

Now of course, growth is one part of the equation. But of course, as you remember, the biggest second priority for Pandora and for myself is to protect profitability. A key lever is our response to our rising silver prices. Now in February, we introduced the platinum plated jewelry on our proprietary Evershine alloy, which is going to transition a part of our existing white metal portfolio over time into platinum plate. Now this is supporting profitability -- but equally and most importantly, it is a compelling consumer proposition. Why? It's bringing platinum, which is a precious metal into a more accessible format with a strong durability for everyday wear.

Now I think it's important to remind that Pandora has already evolved beyond a single material proposition. But what matters also is that consumers choose Pandora for our design, our craftmanship, our quality and our meaning across different materials. We don't need to speculate. A proof of that is the success of our gold plated jewelry, which continues to grow strongly.

Now of course, as you remember, we have been working on this transition for more than a year. This transition is being supported by extensive consumer testing and validation. So all above give us confidence in the acceptance and adoption of platinum plating as a wide metal proposition. Now during the quarter as well, we have started our pilot in the Netherlands with 5 key carriers, 4 bracelets and 1 necklace. Now this is early, but the initial response, I have to say, has been encouraging on the adoption, and we are also using the pilot to learn and refine our execution before the global rollout next year.

We will extend as well this year with more selected design across more markets, and this will be a good source of learning for us. Now important to remember, this is an evolution of our product platform that is bringing greater choice to consumer while strengthening the long-term resilience of our business. We expect and it's very obvious that we will be the first jewelry brand to bring platinum plated jewelry to scale. We will be providing more detail on the rollout and as well on the latest financial and EBIT margin implications with our quarter 3 strategic update.

But on that note, I'd like to now hand over to Anders to take you through the rest of the presentation.

Thank you, Bert, and good morning, everyone. And please turn to Slide 14. Bert has already commented on the top line, so I'll focus on a couple of the other financial metrics. And the key message for the quarter is that margins remain solid. That's both on the gross margin and EBIT margin level and that we continue to manage all of the external headwinds quite effectively.

And as I'm sure you've read, we did get a one-off benefit this quarter from the partial refund of our U.S. tariff claim, and we've broken it out in the impact out on the margin for you, so you can track the underlying performance. This one-off meant that our gross margin was up 120 basis points in the quarter. But even when you exclude the one-off, you'll see that our gross margin was still above 78% and thereby only down around 100 basis points compared to last year despite that we faced just under 300 basis points of external headwinds. So quite a strong margin and highlighting the good cost efficiencies that is still being delivered, but also a deliberate reduction in promotions, as Bert has said.

Next slide, please. And here, we break down the revenue growth in the quarter as usual. We've talked about the like-for-like building block already. So I'll touch on some of the other elements in the bridge. On the network expansion, the purple building block at 4%, that continues to track well, generating healthy top line growth in white space areas and with no cannibalization and generating very healthy margins. You also noticed that this quarter, specifically, we saw a 2 percentage point drag from the bucket that we call sell-in and other. And there's 2 elements to this. One, it's just phasing between quarters that we will always see. And then secondly, some of it is linked to lower sell-in to certain partners.

Next slide, please. On the EBIT margin, performance was strong. The EBIT margin was up 210 basis points year-over-year. And as you can see from the bridge here, it was helped by the partial refund of our claim on the U.S. tariffs, and that accounted for 250 basis points on EBIT margin level. It is a one-off, of course, and there will be more of that coming in the second half of 2026, and I'll speak about that shortly.

If you exclude that one-off impact, you can calculate that the EBIT margin was broadly in line with last year. And some of you would probably point out that even that was a bit better than what we have communicated about phasing through the year earlier on, and that's fair. And the reason is that just like in Q1, we did see some cost phasing benefit of around 200 basis points in the quarter. And that phasing includes the level of marketing spend where we ended up deciding to spend, which you can also see in the announcement today that it is a bit below last year. But that phasing will be reversed in Q3 and Q4 and then be neutral for the full year.

And overall, yes, you should read from this that we are, of course, keeping a tight control on our cost in this current subdued revenue and macro environment, and we will continue to offset a large proportion of the external headwinds that we are facing.

And with that, let's move on to the guidance. As Berta already said, we have upgraded both our revenue and EBIT margin guidance. And let me tackle revenue first. We upgraded our organic growth guidance by 1 percentage point on both low end and high end to now being plus 2% to minus 1%. And this -- sorry -- yes, sorry, 0% to 3%. And this upgrade is driven by higher like-for-like expectations for the full year, where we now see like-for-like growth of between plus 1% and minus 2% versus previously between flat and down to minus 3% and the low end of that range continues to factor in the fact that the consumer environment remains weak and the geopolitical uncertainty remains quite high.

And we do not know how this will play out for consumers even on a short time horizon. The high end of plus 1% basically calls for similar growth in the second half as we saw in the first half. So keeping the run rate of our like-for-like growth to what we've already seen. We do acknowledge that our comp base is getting easier in the second half of the year. And here's a couple of thoughts on how to think about that.

First of all, we are planning a promotional detox in the second half of the year to further protect brand equity. And secondly, if you dig into the comp base, you will see that the 2-year stack mostly gets easier in the U.S. But the U.S. is at the same time, the market with particularly high macro and geopolitical uncertainty, and it's also the market where we see the K-shaped economy impacting our consumer base.

And lastly, we do not expect to repeat the growth levels that we've seen in Latin America and Asia Pacific in the first half of the year. Some of this will naturally moderate. And when we say this, and that's not to ignore the impact of the initiatives that we are working on to reignite the growth engine, but these will take time to feed through into sustainable improvement in like-for-like every quarter. And as we did say back in February, 2026 is a transition year.

As you can also see in the bridge, we have increased our network guidance to plus 3% organic growth contribution, up from 2% initially. And this increase is then offset by slightly lower sell-in to certain partners. And we now expect sell-in and others to be around minus 1% and then those 2 components net out.

And then if we go to the next slide, please. On the EBIT margin guidance, we've upgraded it to 22% to 23% from 21% to 22% before. So an increase of 100 basis points in both the low end and the high end of the range. And this change in the guidance, you can see here relating to the purple box that we call tariff refund and the 100 basis points being the income we expect from the refund of tariffs that we have previously paid.

We already got an impact that we just talked about in the second quarter, equivalent to just around 50 basis points of full year EBIT margin impact, and we expect to have another similar 50 basis points positive impact sometime during the second half of the year. And again, this tariff refund is a one-off benefit for the year. So keep that in mind when you think out to 2027. And all other building blocks are broadly unchanged.

And on that note, I'll hand back over to Berta.

Thank you very much, Andres. So let me just conclude. And I would like just to leave you with a key few points. Yes, we are making progress on the priorities we set out in February. The actions are now in motion across the business, and we are seeing encouraging proof points. Now there is still more to do to translate this consistently into a stronger like-for-like growth. Now at the same time, we are also driving healthier growth through greater promotional discipline, and we do continue to demonstrate a strong financial control.

Based on our performance and outlook, we are upgrading both our top line and EBIT margin guidance for the year. We are progressing our transition to platinum plating, which is an important evolution of our product platform that will diversify our metal mix and strengthen the resilience of the business over time. We will be saying more -- much more about it on the next phase of -- on this phase -- next phase for Pandora and all our strategic priorities with our quarter 3 update.

Now if you allow me before we move to Q&A, I will just briefly like to touch on an announcement that we made last Thursday regarding you, Anders. As you know, Andres has been an integral part of Pandora's development, and I am really personally very grateful for everything that he has contributed to Pandora. We do, of course, respect his decision to retire from operating roles is his choice, and we wish him all the very best. Of course, at the same time, we are very pleased to welcome Paolo Garcia. He will be joining Pandora in October. We will have a leadership transition that will run very smoothly between both of them. And of course, this does not change our strategy, does not change our priorities or our ambition for Pandora. We do know where we are going. We remain fully focused on our execution to deliver that with discipline and consistency.

And with that, please let me thank you for your attention, and I think it's time to open for the Q&A.

[Operator Instructions] Our first question will be from the line of Thomas Chauvet from Citi.

And before questions, let me thank you for all the support over the years and best wishes for your retirement from executive life. I think you have many other exciting projects. And so all the best for that. My 2 questions are as follows. The first one on the U.S. LFL improvement in a still difficult consumer sentiment environment. What are you seeing across traffic, conversion, average ticket? And Berta are you starting to see tangible benefits from the recent product and marketing initiatives that give you a greater confidence about a rebound in this market maybe in the back half of the year?

And secondly, on the tariffs topic, but maybe for next year, you indicated in the release a lower tariff rate of 12.5% on U.S. imports from Thailand going forward, down from 19%. I mean how much do you expect that to support your gross margin next year? And could you comment on the implications for Vietnam as well? Is there any change there in that new crafting facility's tariffs for the U.S. imports? And -- but also could you comment whether that facility is also adapting, shifting to the platinum plated strategy as planned, given it was built for a slightly different purpose, I guess, more for silver type of business?

Yes. Thank you, Thomas. Let me start with your question on the U.S. What we are seeing in the U.S. is that the consumer sentiment continues to be low. The macroeconomic continues to be difficult for the increase of discretionary spend. And this is something that you see. What we see on the industry, on the total jewelry and accessories industry, the traffic is slightly flattish. We are slightly behind on traffic, but we are seeing a strong increase on our conversion on our average basket for the U.S. business, and this is both on our offline and our online store.

So everything that we see indicates that what we are doing with the distinctive newness and the new marketing model is working in the U.S. We see that as well reflecting on the performance of the Timeless collection, which was growing as well in this market. So yes, the proof points are building up, and that's why we are confident for the remaining not only of the year, but of the years to come.

Thank you, Thomas. On the other question -- thank you for your kind words. On the tariffs, when we communicated targets back in February, a high-level guidance on the EBIT margin for 2027 and midterm, that was based on the assumption of the old tariffs, if I can call it that, around 19% to 20% level. So with the new tariffs in place, that gives roughly 70 to 80 basis points of margin upside on gross margin going forward compared to what we've said previously. So we take that.

On Vietnam, the tariff level between Vietnam and Thailand are very much aligned. So there's no competitive difference from that point of view from producing in the 2 countries. And Vietnam is definitely part of our overall plan on how we build up much more plating capacity going forward. There will be some plants that have a higher share of plating than others like today where one of the factories in Thailand, the BB factory is only doing plating. So there will be some differences between them, but there's no disadvantage on Vietnam from the tariffs.

Our next question will be from the line of Lars Topholm from DNB Carnegie.

Congrats, first of all, on a great quarter. And from me also Anders, thanks for everything you still look way too young to retire, but that's how it is. I'll also limit myself to 2 questions, please. So one goes for the moving parts in 2027, where you specifically call out that the price of silver, everything else equal, helps you with 200 bps on the gross margin compared to the assumptions behind the 12% minimum margin, 14% underlying. I wonder if you can give a similar specification of the tailwinds relating to gold, relating to FX and relating to platinum. So we sort of know what moving parts you are working with?

And then a second question, maybe for you, Berta. I just wonder if you can put some more color on what you are seeing from the platinum plating in Holland. And I know it's early days and not that many SKUs, but have you learned anything that surprised you pleasantly or the opposite? And what are sort of the key findings? And are there any sort of hard numbers you can share so far?

Thank you for those questions, Lars, and I'll put you look younger into my scrap book. So a particular thank you for that. Yes, fair question on the margins. Starting with 2027, silver, just around 200 basis points as we wrote in the announcement. And the logic in that is that the original assumption was a silver price of $82. Now we've hedged around $65. So that's a $70 -- $17, obviously, upside. And with a sensitivity next year in the 12%, 13%, 14% range basis points per $1, you get to around 200 basis points of upside on that.

Then on gold and platinum is much smaller numbers, but still an upside of -- in round numbers for both gold and platinum, 25 to 30 basis points of upside at the current spot prices each next year. And then as we just spoke about just before, then we have 70 to 80 basis points of tariff upside as well if they remain at the current levels that was announced by the U.S. government over the summer. Foreign exchange is a small change. That on a pure technical upgrade that will give just a little bit above 300 basis points of margin upside next year on all other things basis.

But of course, we think that it makes more sense to give you a broader update on the margin guidance for '27 and midterm as part of the strategic update that will be coming in November because, of course, there's other moving parts than commodities and silver. So we want to bake it into the broader update, which feels like a natural time to do it come November.

Yes. That makes sense. But in connection with that, because in your part of the presentation, you also mentioned underlying margin drivers contributing 250 bps. So since we are on that topic, maybe you can specify what those are. I mean there's some channel mix, there's probably some price, there's some efficiency gains. There is an effect from fuel more outperforming core. Can you quantify that bridge a little bit more?

You're thinking about specifically the second quarter margin.

Yes, because I assume some of these drivers are also drivers which are relevant when we look into 2027.

Yes, fair comment. By far, the majority of what sits in that sort of net operating leverage in the second quarter that upside there, that's cost phasing to the tune of 200 basis points specifically in Q2. And again, if we drill one more step down into that cost phasing, more than half of it is marketing, where we have been spending less marketing in the first half compared to last year. And in the second half, we will be spending more than what we did last year. So on that note, there's no sort of other structural changes for the '27 margin apart from commodities and tariffs.

On your second question will actually become the third question. We -- on the platinum plated. So you said it, Lars. I think we -- it's still very early days, but what was a pleasant surprise was to see that it was confirming the hypothesis and it was according to the expectations of all the data that we have previously collected with our more than 30,000 consumers. So that is actually confirming what we initially expected.

Just to give you a little bit more flavor, as a reminder, we are doing a test on both our physical stores and on our online stores. On our physical stores, the platinum plated products are priced at the same price as silver. So we are learning about what is the demand when we price at the same. And on the online, we're actually getting a different price testing as well. So more to come on our quarter 3 announcement on all the learnings on that part. But so far, confident.

Our next question will be from the line of [ Frederik Novest ] from Morgan Stanley.

I have 2, if that's okay. Firstly, on the 2026 like-for-like guidance. So you're now guiding for minus 2% to plus 1% for the year, which given the flat like-for-like in H1 implies roughly minus 4% to plus 1% or 2% in H2. But at the same time, Q3 trading is already running at mid-single digits, albeit with some benefit from phasing of commercial activities. So perhaps could you help us understand the degree of conservatism embedded in the guidance and specifically what you -- what would drive the slowdown implied for the remainder of the second half and in Q4 in particular?

And then my second question is on Europe. Berta, you mentioned earlier today that the recent heat waves have weighed on store traffic in Europe with some consumers staying at home and shopping online instead. So could you help us understand how material that impact has been on recent like-for-like trends? And are you seeing online growth broadly offsetting the weaker store traffic? Or has there been a net negative impact on like-for-like? And as temperatures have normalized now, I think, have you seen any corresponding improvement in store traffic?

I'll take the first one on the guidance. You're broadly in the right ballpark in terms of the implied like-for-like growth for the rest of the year with the high end implying around 1-ish. I just kind of repeat what Anders said, there is a kind of deliberate detox on the promotion planned even for the remainder part of the year that will a small part of a drag against that just to protect the brand equity going forward. And I also appreciate your comment on kind of current trading. But again, we said please don't take that as a run rate right now. There's some phasing element in that as well.

And then last but not least, we're still relatively cautious on the broader macro environment in the U.S. as well. We'll see how that plays out. So many moving pieces. I appreciate the math is what it is as well, but there's many factors at play here.

Yes. And then on the traffic, is it substantially impacting the quarter 2 results? The answer is no. And did we see some changes on those weeks? Yes. I mean, what we are seeing is that if I take the full quarter 2 traffic in 7 out of our 10 markets, the traffic for the industry, so this is either the jewelry and accessories or the retail has been negative on the quarter 2, and we are pretty much either online or slightly negative depending on which are the countries.

As far as our e-commerce performance, it's pretty much on line for the total quarter with our offline with, again, maybe on those 2 weeks, yes, we saw a slightly peak, but we are just talking weeks out of 3 months. So not a substantial impact.

Our next question will be from the line of Kristian Godiksen from SEB.

I usually don't do these congratulations, but Anders, I also want to congratulate on a strong heritage and performance based on your well-deserved choice to retire. So the 2 questions I'll limit myself to this time. First of all, maybe could you comment a bit on the -- whether there is a structurally higher run rate and hence, impact from new stores as you alluded to you upgraded the guidance from network expansion without upgrading the number of new stores. So that will be the first question.

And then the second question, I guess that's for you, Berta. Could you maybe comment a bit more on the when should we look in terms of timing of the inflection points in terms of like-for-like improvement in mature markets such as Italy and the U.K. and France based on all the initiatives you are doing?

Thank you for that, Kristian. And likewise, a pleasure to have been working with you. But you're right that we are upgrading the network guidance, but keeping the same number of stores that we opened this year. But when we set out the guidance at the start of the year, we took a probably somewhat deliberate cautious stance on this given that it's a transition year, but also the uncertain consumer environment. and the network assumptions and how much growth each store would be generating was part of that.

And then since that, so far, the 7, 8 months that has passed so far, the rollout of new store has tracked at the upper end of what we had planned for internally. And that has the new stores generating a bit more revenue than we had in the original 2% assumption. So we're basically simply bringing the assumptions now in line with the actual delivery for the first 7 months of the year.

So maybe just -- and before Berta, can I maybe just follow up, so basically to understand, I guess, many of the stores are opening in some of the -- in the new markets. So is it fair to assume that you're confident or optimistic or a bit more optimistic on the growth contribution from network expansion in these new markets? Is that the way to look at it as well?

I think in general, the way to think about it is that when we set out the original guidance, we had an assumption of both, of course, when do the stores open and then what kind of revenue do they generate from day 1. And on both, a little bit earlier in terms of opening them and they generate a bit more store than what -- sorry, a bit more revenue than what we had hoped for in this macroeconomic environment. And that's somewhat, I would say, in the decimal. When we made the original guidance, we were -- it was 2-point something that rounded down to 2. And now with the updated assumptions, it's 2-point something that rounds just to 3. So that's also, of course, one of the consequences we report in -- without the decimal, and you can't see that.

Yes. And as for your other question, basically, if you look at the performance of our core market, it is directly linked to the performance of our core collections. So what we need to do is to start improving the performance of the existing core collection. And as we said already, this is coming from new distinctive newness being reinjected to refresh the core collections. What we are starting to see, we are now focusing on that, and you will start seeing improvement over time.

When we look at the time it takes us to develop collection, the biggest impact will start from 2027. But of course, that doesn't mean that we are doing nothing this year. We are just trying to maximize the impact of what we had on our plan. One example of that I shared with you was Wonders, where we created a lot of noise and achieved earned media value record for Pandora, 10x more than previous activation. So we continue to focus on driving that perception as we bring the new collections.

Very clear. You said -- I think you said earlier on the conference call that you could see when -- I think it was a connection when Philippa was hired that you could see some newness in Q4. Is that still in place for timing-wise that you will see some of the newness in Q4?

She's working hard on that. So that still remains some of the plan. And then let's see how much volume we can bring. One is to bring the design and the other is to make sure that we can scale that at a substantial level.

Our next question will be from the line of Daria from Bank of America.

This is Daria from Bank of America. And I also wanted to say thank you to Anders for all the years of collaboration. And I have 2 questions. Could you please share the split between volume, price and mix in the second quarter, but also in your current trading number? And then a clarification on the EBIT margin guidance upgrade. Considering also better like-for-like growth guidance, why is the underlying market assumptions not really moving considering the upgrade fuels driven mostly by the tariff refund?

Thank you for that kind words, Daria. On the second quarter, the overall volume total is slightly positive in the quarter. when I'm thinking about total revenue growth. If you look specifically at like-for-like units, it's down 2 points and then you have plus 3% on the pricing, then that takes us to the 1% like-for-like for the quarter.

And then on the -- on current trading, we don't comment on that, but it is structurally you should think the same on the pricing side because we didn't do any pricing in between. Then on the underlying, you're right, technically that with 1 percentage point higher like-for-like growth, there's a little bit of operating leverage, all other things equal in that. We -- it's -- of course, it's not something that moves several percentage points on the margins that will be in the decimals. But we have decided -- 2 things to note here. We have decided to invest a little bit more in reigniting our growth engines in different parts of the world. That includes Asia, where we want to put even more muscle behind that becoming an even bigger growth driver in the years to come.

And then secondly, we have bits and pieces on the freight cost from the Middle East crisis. It's not a big money in our context. But net-net, that means that the underlying margin is the same despite the revenue upgrade.

Our next question will be from the line of Anthony Serchaffri from BNP Paribas.

It's Anthony Serchaffri, BNP Paribas. I have 2 questions, please. The first one is on the tariff reimbursement, which is an interesting deal that you've done with a third party and leaving $0.23 to the dollar on the table. So just curious to know if you felt that there were a sense of risk on those reimbursement and why would you -- did you took the decision to book the cash in Q2 and Q3? Is it a sign that potentially you could resume share buyback as early as 2027.

And my second question is again on the 2027 margin comments, maybe just on the commodity part because I have quite a bit of a delta versus your indication of 250, 260 bps upside to the guidance on commodity. Could you just remind me the moving part because if you switch 1/3 of the silver consumption and it's switched to platinum, I get something closer to 400 bps instead of 250 bps. So maybe just some color on those sensitivity would be very helpful for me to understand why I got it wrong.

All right. Thank you for those questions, Anthony. Let me start with the tariffs. So yes, you're right. We sold the claim back in early May based on an evaluation of the risk of whether the funds would actually ever come back. We had quite extensive discussions about that, both how long time it could take before cash would be returned if ever, by the U.S. government. And therefore, we decided to monetize the claim and sell it. So we got the money that was received, the $55 million we received back in the first part of -- the first half of May. And we know that several companies or many companies around the world that decided to do that. But it was based on a risk reward compared to the discount that we had to sell the claim at.

The accounting about this is under IFRS is actually rather complex, but all the cash is sitting on the bank account. They have been received. And then on the IFRS accounting, how that works is that even though we've sold the claim on a nonrecourse basis, so it's full and final, then we can only take the income in the P&L as such as the refund administrative process in the U.S. is progressing. That led to $28 million coming into the books in Q2. And we expect the majority to come here in the second half of the year, maybe in Q3, maybe in Q4, that still remains to be seen.

And on the share buyback, you're right. Of course, everything helps, we're getting cash into the bank, but it's still too early to go down the line of reinitiating a share buyback program. I think if you do a little bit of math with the 2027 margin, you would see that we would be above the leverage range next year. If we started out the share buyback program either this year or next year, in fact. That doesn't mean that we wouldn't end up concluding that a share buyback program next year might be appropriate, even though it would lead to leverage being a little bit above the range for a short time as we transition into platinum play. But that's too early to decide and communicate anything on that. That will be part of the 2027 communication.

And of course, also when we come out with the full year guidance for next year in February next year, we will talk about how we look at it at that point in time. But I think it's very important to stress it's not a question of if we start share buyback programs again, it's only a question of the timing during this transition into platinum plate for part of the jury. And then the consequent increase in leverage that we will see just by pure math because the margin will go down next year compared to this year. So more to come on that.

And then on the 2027 margin, high level, the way to think about the silver sensitivity, if we take that one specifically, then in 2026 so this year, the sensitivity is around that if the silver moves $1, then the margin changes 20 basis points. And now with the level of transition that we're doing from silver to platinum, then next year, that sensitivity goes from the 20 to around 13, 14 basis points. That's just that one and then the sensitivity will go down even further next year. But that -- if you're using 13 basis points sensitivity per $1, then the upside on the margin next year would be $17 lower from $82 to $65. That's now being hedged times 13, and that gives you 214 basis points to be precise, but let's call it 200 basis points of margin upside.

And then I'm happy to go through the math on gold and platinum or we can follow up separately afterwards with IR. But then the sensitivity is obviously still much lower, and that would give 25 to 30 basis points uplift on each. And there, the spot -- the prices that we are using is that in the original announcement back in February, we used a gold price of just about $4,700. And getting to the 25 to 30 basis points upside, we are using a gold spot price of $4,400 and equivalent on platinum it's from $2,400 originally to now around $1,600 spot price for platinum. But again, I'm happy to go through it and reconcile the math that you had in your mind.

Okay. But just to confirm, in terms of silver usage, your assumptions still take into account a reduction of 1/3.

Yes. Exactly.

Our next question will be from the line of André Thomann from Danske Bank.

I have 2 as well. So first question is regarding this promotional detoxing you mentioned, Anders, in the second half to come. Can you maybe tell a bit more about where this will be in the world? And then second question is regarding the U.S. like-for-like in the second half. Can you maybe put some words on why we won't see a significant uptick in like-for-like with comps coming significantly down in the U.S. for the second half? That's my questions.

Yes. So why don't I start with the retail discount. I would say that what you will see -- you should expect to see this is pretty much across all markets, but we have as well a higher focus on our mature markets. So you should expect to see a reduction on the U.K., on Italy, et cetera, as the biggest reduction. Of course, when you look at the retail discounts, you will see a big decline. And what we are seeing is a big decline on the retail discount level on LatAm.

As a reminder, there was a change from a high low positioning in the previous year to the beginning of this year, getting the same pricing in line with the rest of the pricing corridors on the rest of the world and substantially reducing the promotion to nearly half of the days. So long answer short, it's across all markets, but we are focusing heavily on the mature markets, which is where we saw the highest increase in the last 2 years.

And sorry, Andre, I didn't get the second question.

I just asked why we won't see a strong like-for-like pickup in the second half for U.S. when the comps are much lighter.

Okay. Let me start, and again, Andre, you can complement. I think we discussed it in the call. I mean, we are not claiming victory yet. We are seeing strong signs that our model is working. But if you look at it, our like-for-like growth on core is still negative. I can look, of course, at what is happening on the collections and the base assortment in this market. So we are sensible and we remain prudent with our approach.

Yes, we are -- the comps get easier. But at the same time, and I answered that before, we are seeing a decline on our promo detox as well, which -- in the U.S., it was we do on our offline, but also on our online, on our e-commerce store where we were promoting slightly heavily on quarter 3, adding more days in addition to the Black Friday weeks, et cetera. So those days of extra promo outside of the big commercial periods will go away, and that will have an impact.

And of course, last but not least, this is a market where the consumer sentiment is still low at record lows. We see jewelry increasing, and then we could be very happy about that. But when you double-click on that, it's actually on the high income. So the accessible jewelry market is still declining, and this was in quarter 1 and quarter 2. So really, we are just looking at the facts and making just sensible decisions for the rest of the year.

Our next question will be from the line of Lars Topholm from DNB Carnegie.

Just a couple of brief follow-ups, please. On the current trading and this uptick from Q1 to the mid-single-digit level in the beginning of Q3. Can you comment on is this broad-based? Is it specific markets driving this? And the second follow-up question, Berta, you gave a comment on the performance in mature markets being related to how the core performs. So I just wonder if you can give some numbers on the distribution between core revenue and fuel with more revenue in some of your less mature markets like LatAm, Japan, Spain compared to the group average where fuel with more 26%. Is that significantly higher share in some of these younger markets?

I'll take the first one, Lars. So it's relatively broad-based. The commercial phasing had quite consistent effect across all regions really. Yes, on to Berta.

Yes. I think on the thing you should expect when you look at all the mature markets and when you look at [ Vietnam ] and EMEA and given that is really the biggest part of our market, the split is the same. What we are seeing is slightly different is when we start new markets like Japan, where we are seeing that is slightly more, let's say, balanced between the core and the fuel with more. But on the majority of our business is exactly the same. So this would also imply profitability incrementally is better in like LatAm, Japan potentially more higher margins?

It's close to each other. So I think the gross margin between the 2 are sort of high or high. But strictly speaking, you're right.

Our next question will be from the line of Kristian Godiksen from SEB.

Also a couple of follow-ups from me. So maybe could you comment a bit on the relative weak performance in the online channel this year and yes, compared to the underperformance of the physical stores contrary to the last many years? And then secondly, could you elaborate a bit maybe on the -- I noticed a jump in the unaided brand awareness in the mature markets for the younger groups in the first half year in 2026. It would be nice to have some more flavor on that.

And then thirdly and lastly, comment a bit on the lower selling. I guess it's a bit contrary to me based on the performance of wholesale actually for a very long time, obviously, has underperformed. But this quarter, actually, it's doing better than your own stores. So yes, it sounds a bit contrary to me that then they reduced their inventories. So happy to hear some thoughts on that.

So why don't I start on the e-com. I mean what you see, I mean, we've been talking quite a lot on this call about the promo detox. And we were detoxing, of course, in the entirety of our business. So we do get less offer hunting that we will get actually on the e-com. So I think this is one of the biggest driver.

The second question was?

Unaided brand awareness among the younger...

Yes, sorry. So that's good. So what we -- it's important to say is that unaided brand awareness continue to increase, so which is important because, of course, as you know, we are moving from only reach to reach and relevance. So the shift on the marketing investments that are going more to earned media, PR, et cetera, is not in detriment of our reach. So we continue to increase that. What we are seeing as well is that the recent activations that we have done has drove proportionally more Gen Z consumers into our brand. So we continue to be cross-generational. So -- and this is an important strength for Pandora. But it is, of course, important that we are relevant to the new generation. And what we've been doing in the last quarters, in the first half of the year has actually increased the number of Gen Z consumers slightly higher than the millennials and the Gen X.

And on your last question, Kristen, I think that's very well framed. And where we see the lower sell-in is on the partners that are not sitting in the like-for-like base. And with the way that we build up our revenue growth rate starting with like-for-like, then the like-for-like basis, let's call it, almost 90% -- 85% to 90% of our revenue base. But then we have the small multi-brand partners as an example, that is not counting in like-for-like, but obviously impacts our sell-in.

And that's the main area where we see that a drag on the sell-in and thereby the reported revenue and have seen for a while that those partners are trailing the growth that we can generate in our own channels and in the partner concept stores. probably partly linked into the fact that we have a bigger marketing muscle that we can put behind that helps our own channels more. But that's the link into why we see this sell-in impact.

Okay. That's very clear. Just one very quick follow-up and then just on the performance on the like-for-like -- sorry, on the online channel. So when -- what about the structural impact? Are there any there when the promotional detox is done? Should we expect online to grow faster than physical stores? Or how should we think about it?

Yes. Exactly, that's typically how we see it. The reaction online to promos is bigger than in the physical store. So when you -- if you do more promos, you will typically see faster growth online. And case in point, the second quarter here goes the other way around as well.

As we have no further questions in the queue, I'll hand it back to the speakers for any closing remarks.

Yes. So listen, just thank you very much for being with us today. We just like to remind everyone that we are not declaring victory, but we are seeing that the proof points are building, and this is just reinforcing our conviction on the direction and on the new growth model. I am looking forward to seeing you in November for our quarter 3 update and a more of a strategic update on all the other shifts that we are planning for Pandora. So with that, just have a fantastic day.

Good morning, everyone, and welcome to the conference call for Pandora's Q1 2026 Results. I'm Bilal Aziz from the Investor Relations team and I'm joined here by our CEO, Berta De Pablos-Barbier; CFO, Anders Boyer; and the rest of the IR team. As usual, there will be a Q&A session at the end of the call. [Operator Instructions]

I would also like to draw your attention that at 12:00 CET today, there will be a national Danish emergency alarm system test. So you might hear some background noise, but hopefully, that doesn't interfere. Please pay notice to the disclaimer on Slide 2 and turn to Slide 3. I will now turn over to Berta.

Thank you, Bilal, and welcome, everyone. I am going to first start with a brief summary of our quarter 1 performance before turning to an update on the strategic initiatives we outlined back in February on how we were going to reenergize growth. So let's start.

In quarter 1, the quarter played out broadly as expected. We delivered 0% like-for-like growth and 2% organic growth. We delivered this in a challenging consumer environment, and yet we are clear that there is more we can do to drive a stronger like-for-like growth, and I will come back to that.

On profitability, EBIT margin remained solid. This continues to reflect our high gross margins, where efficiency gains continue to offset most external headwinds, combined, of course, with tight control of our OpEx. Finally, returns remain high at close to 40% despite the external environment. So please, let's move to the next slide.

Turning to guidance. We are maintaining both our top line and EBIT margin guidance. For the top line, we continue to target organic growth of minus 1% to 2% with like-for-like growth of minus 3% to 0% and network expansion of around 2%. We have started the year towards the upper end of this range, which is a solid start. That said, it is still early in the year, and the external environment remains uncertain. Since we last reported, the geopolitical backdrop has become more volatile, and the implications for consumer demand are not yet clear. Given this, we believe it is appropriate to maintain our guidance at this stage. At the same time, we do see the need to a step up execution across a few areas. The benefits of this will progressively build over time.

On EBIT margin, we continue to target 21% to 22%. This implies a broadly stable margin versus 2025 when adjusting for external headwinds, which reflects continue investment in the business while still maintaining a high level of profitability. In terms of current trading, we are tracking around flat so far, flat like-for-like growth in this quarter. So let's move, please, to the next slide.

Now, let me just do a very brief recap of what we covered back in February, and you probably recognize this slide. I am not going to go into detail today, but it's important just to set the basis. Our vision is to be the most desirable, accessible jewelry brand. We do see significant headroom to deliver sustainable long-term growth in Pandora. This translates into three clear strategic shifts across design, marketing, and go-to-market alongside progress on the new materials. Overall, the priorities are very clear for us: accelerate like-for-like growth while protecting profitability.

So let me just show how we are starting to deliver against this, and we'll see that on the next slide, please. This chart is as well something that you will recognize from the full-year results and shows how we are evolving our growth engine. The three area that I mentioned, design, brand, and market, and we are already starting to put this in motion. We are not standing still.

On design, the priority is to reenergize our collections. Product development takes, of course time, but it's a clear focus, and we are accelerating where possible. I have a couple of examples later on.

We have appointed a new Chief Product Officer, Philippa Newman. She is reporting directly to me, and elevating design is a central driver and a clear priority for her. Later today, I will introduce a new program, Pandora Wonders, that is designed to a step-change creativity and the perception of our craftsmanship.

On brand, we have already start shifting towards activation-led engagement with earned media as a core KPI. So investment is already to start being reallocated towards channels and activations that are focused on driving cultural impact and earned reach.

Last but not least, on markets, we are moving towards a model that is more calibrated by market maturity, supported by a stronger local capabilities. Just to name one example, in Italy, a key market for us, we have already started to refresh some visual merchandising, update layouts on our store to better showcase our collection, and some new introductions planned. We are confident this is how we will drive growth going forward.

So let's go, please, to the next slide. This is, again, you will recognize this is the key is starting with design. Remember that I mentioned last time that when you look at the left-hand side, which is where we operate today, a large share of our business sits within a relatively narrow aesthetic space in the market, is what we are calling playful, where our main -- our core sits, especially our moments collection. So this is where the portfolio is most mature and what our design effort has been focusing on. But growth is coming from elsewhere. Underrepresented aesthetics, while smaller for Pandora today, are big in the market and thus deliver a disproportionate share of incremental growth when we invest behind them.

The direction is very clear. First, we need to refresh the core with a more distinctive design in our largest business. Second, we build depth in underrepresented aesthetics where the growth opportunity is higher. We have already started. We are already seeing early signs. Talisman that was launched last year continues to drive growth and the Bridgerton Limited edition is another example of something that we introduced in quarter 1. Now the opportunity is to scale this more systematically across the portfolio as part of our evolved growth model. We are accelerating this work with impact building progressively from 2026 and more meaningful from 2027.

Can we please go to the next slide? So building on that, we are starting as I was saying to bring this to life. As we have outlined, we are increasing distinctiveness across our collection. This is a new program that will be introduced in a couple of weeks. We call it Pandora Wonders and is a key part of that.

Pandora Wonders is a multiyear platform to elevate desirability and drive demand through a step change in creative expression. So each year, we will partner with the leading creative voice to reinterpret the materials we work with and how we craft them through limited edition capsules. This is intending to drive excitement, traffic and reinforce our growth model of distinctive newness and earned media.

We will start with act one, which will be a playful reinterpretation of the organic Pearl. It will be brought to life through a signature artisanal technique that is the pearl micro-piercing. Now we are building this platform over time, so you will see more coming every year. You will hear more as we do. And as you may notice, we are not focusing on silver by bringing a new material to Pandora that we are showcasing.

The second piece of the news today is that we are adding carbon footprint labeling to our lab-grown diamonds. This means that consumers will be able to see the climate impact of every Pandora diamond and compare that with a mine diamond. The CO2 emissions of our diamonds are 90% lower than a mine diamond.

So, Pandora is about being accessible and being accessible is also about being transparent. We do think that this will reshape how the environmentally conscious consumers will be choosing within the category. And as the leader, we have to be present providing the facts. We are actually presenting this today as we speak at the Copenhagen Fashion Summit, along with one of our ambassadors, Pamela Anderson. And if you want more information, everything is now on our website if you are interested.

Now let's move to the next slide, please. I mentioned earlier that my second priority is clearly to protect our profitability. You know that a key lever here is our response to rising silver prices. In February, we introduced platinum plated jewelry on our proprietary Evershine alloy. As you know, the alloy has been optimized for platinum plating, delivering a strong durability, including tarnish and water resistance as well as being high calorigenic. So, for consumers, as I mentioned before, this brings platinum, which is a precious metal into a more accessible format, which improve everyday use. Now this launch was prepared over the last year, 2025, with extensive consumer testing and validation that confirm the strong acceptance of platinum plating within the white metals.

So later this year, we have selected designs that will be introduced, and I remind everyone that the broader rollout will happen from 2027. We will be the first jewelry brand to bring platinum plated jewelry to scale. Now it's important to know that plating is not new to Pandora. Today, over 1/3 of our sales already come from outside silver. So plating today is pretty much 1/4 today of our sales.

So, we've been operating plating at a scale and high quality already for several years. This is a capability that we already run across the business. This is all I was planning to detail in terms of the strategic update. So, I think it's a good time now to turn to the quarter 1 performance.

For quarter 1, we delivered flat like-for-like. You can see the growth speed between the core and the Fuel with More here. In the core, we deliver minus 1% like-for-like growth. This was supported by good growth in our distinctive designs, Talisman and the limited-edition Bridgerton. But of course, this decline also underpins the need to refresh the rest of the portfolio, which is what we are working on and we have already identified. For Fuel with More, we deliver 1% growth, which was supported by the new collections of Pandora Essence and newness in Timeless.

Let's move to the next slide. As I mentioned earlier, as part of our strategy in addition to design is how we bring the brands to market. We are becoming more deliberate in how we use cultural activations. Bridgerton was only one example. But you see that in quarter 1, we partnered with KATSEYE to support performance in Minis, the Minis collection. We activated new brand ambassadors across selected markets as going forward, earned media impact will be a key metric for us. And these are just early examples about how we are applying this approach. The focus now is to scale this more systematically across the group, combined with strong product execution.

Now let's go to the next slide. Here, you can see how we've been executing Bridgerton. It's a good example of what we mean by cultural relevant collaboration. It's not just a partnership, but it's about being fully integrated into this cultural moment. It's about using talent from the show in our campaigns. It's about integrating our products into the show and is working in close collaboration with Netflix for the release day of the show. This is why this has resonated globally and actually performed ahead of plan.

The global Bridgerton activation run across more than eight markets, drove 6% increase in earned media value through PR and influencers and by the way, 11% on the key titles that really have a strong visibility.

So importantly, we saw how all this activation translated into demand across the broader assortment, both in store and online. Very important as well, we over-indexed with Gen Z, and we also saw higher cross shopping, so a clear halo effect that actually Timeless benefit from.

So this approach, of course, will not be a one-off. We are now scaling the model across markets and collection, leveraging our design capabilities and making sure that we benefit from our vertically integrated business model to execute consistently at a scale, and you will see every quarter more plans on this.

Let's go now to the next slide, please. Now of course, being in retail, we can also need to touch on the in-store experience. We are also working extensively to elevate this. We are including piloting new formats with an updated visual merchandising. We are working on bringing more curative and clarity of our collections, a clear aesthetic segmentation that is designed to drive sales beyond charms and making sure that the new customers that come into our store can see what Pandora is all about.

Now we are testing in Italy between other markets, and the plan is to scale that more broadly over time. In parallel, we are rolling out our digital screens across store facades to better showcase our collection and to strengthen our storytelling with the objectives of drive traffic into our stores. We also have plans to open flagship stores in Barcelona and in Milan later this year. This will showcase the full breadth of the Pandora brand. It will elevate storytelling and it will set a new benchmark for the customer experience.

Let's move to the next slide, please. And I would like to finish before I pass it to Anders on our regional performance in quarter 1, which was, as you can see, somehow mixed. If we start with the EMEA region, our largest region, we deliver a 2% like-for-like growth, broadly stable sequentially. In Spain, Poland and Portugal continue to perform well, but this was more than offset by weaker performance in Italy and the U.K. And you can see, of course, that the performance was minus 2% like-for-like.

In Italy, we are now implementing a new go-to-market approach. This includes shifting marketing investments away from traditional video towards influencer, PR and more locally relevant activation. In North America, similar to EMEA, growth slowed down to minus 2% and performance was impacted by lower store traffic, which really reflect a softer consumer environment. The brand remains healthy, and we will continue to drive traffic through targeted brand activations. I just touched on some of them before.

Now in Latin America, the like-for-like growth accelerated to 6%. There, the price repositioning was introduced early this year and is now in place. We also drastically reduced promotion and all this is driving positive results. We are, of course, supporting this with a strong local activation, influencer engagement in line with our evolve growth model.

And finally, in Asia, we deliver a strong growth of 12%. Our rollout in Japan continues to progress very well. Yes, we do remain in the early stages of building the brand awareness and reach there through increased marketing engagement. But nevertheless, it's an encouraging start.

And with that, I'm very happy to pass it over to Anders.

Thank you very much, Berta, and good morning everyone. And please turn to Slide 19. Berta has already commented on the top line KPIs. I'll just follow -- focus on a couple of the other metrics. And the key messages from us today is that we continue to manage the quite significant external headwinds in an effective way here in the first quarter and our core P&L balance sheet and cash metrics remained healthy.

In Q1, our gross margin ended just below 80% at 79.5% and thereby, it was down only 90 basis points versus last year, driven by the external headwinds of actually almost 400 basis points from the tariffs, foreign exchange and the higher commodity prices. And this gross margin performance was helped by good cost efficiencies in our vertically integrated value chain, some promo detoxing as well as some cost phasing as well.

As you can see in the table, we have shown two KPIs for working capital, including and excluding commodity hedging. And the 6.5% net working capital includes some significant unrealized commodity hedging gains just like in the last quarter. So to understand the performance, it's better to look at the KPI, excluding commodity hedging. And here, you can see that working capital is around 3.5% and roughly the same as last year.

Speaking about working capital, we would like to add some words to the inventory development during 2026. As you probably recall from back at the full year announcement in February, we did not initiate a share buyback program because of the increase in commodity prices. And the commodity prices impact the business in twoways. It will impact earnings mainly next year in 2027 until the transition to platinum plated is completed. And it will also impact inventories and thereby cash flows, and that happens already this year, as you probably know.

At the current spot prices, inventories by the end of '26 will increase by around DKK 2 billion year-over-year due to the commodity prices. On top here, we need to hold more inventory during the transition to platinum plated jewelry, and we are making a few selected investments in inventory to improve stock availability. So all in all, inventories by the end of this year, into '26 will increase by up to DKK 3 billion versus last year. Now it's important to note that this is mostly a temporary impact during the transition. As we complete the transition to platinum plated jewelry, inventories will, of course, come down again. Again, the exact sequence and exact timing is still in the making, but we wanted to make sure that you have this overall storyline.

Next slide, please. Here on Slide 20, we break down revenue growth in the quarter. Berta has already covered the key element on like-for-like. But on the network expansion, and that's the purple building block sitting at 3% in the quarter, that continues to track well and the contribution in the quarter was largely due to the revenue from store openings last year ramping up quite well.

Next slide, please. On the EBIT margin, our performance was solid, down only around 100 basis points year-over-year despite over 400 basis points of external headwinds, as you can see in this bridge. As some of you have probably noticed, we did end a bit higher on the EBIT margin than our own expectations for the first quarter. And we did see a combined cost phasing benefit of around 200 basis points in total in the quarter that's spread across a couple of P&L lines. And it's partly related to lower [retail] cost that sits in the cost of goods sold and to lower marketing, which ended 140 basis points below last year as a percent of revenue, but this will be neutral for the full year of '26.

We are keeping a tight control on our cost in this subdued revenue environment. And our OpEx ratio was basically flat year-over-year on a constant currency basis. We've been executing on the Silverstone cost program, and it's good to see those savings coming through to help the bottom line. And then please go to Slide 23.

As Berta already said, we've left our organic growth guidance unchanged. On a like-for-like basis, we started Q1 at 0% like-for-like, and April has been roughly in line with that. So clearly, we are trading at the higher end of the like-for-like guidance range of between 0% and minus 3%. So a couple of comments to why we leave the guidance unchanged. First of all, it is obviously early on in the year. Secondly, the consumer environment remains weak and the broader macro risk has not become lower since we initially guided back in February.

On the contrary, you're all aware of the geopolitical backdrop, and that obviously increases uncertainty going forward for consumers. We don't know how this will play out. So you should read our guidance range to account for some of this macro uncertainty. Thirdly, we are indeed working on quite a few initiatives to drive a step change in like-for-like growth. We've seen some positive signs in Latin America and in Asia already, and we are working on measures in other important markets as well. But these initiatives will take time to feed through into a tangible improvement in like-for-like. And as we said back in February, 2026 is very much a transition year. Next slide, please.

On the EBIT margin guidance, we've left things unchanged at 21% to 22% margin. There's a few moving pieces within that guidance, but it all nets out to no overall change. But let me just quickly comment on the underlying moving pieces. First of all, on the tariffs, the headwind is a bit lower due to the 150-day pause at a 10% tariff rate. After that 150-day pause, we assume that tariffs move back to the original 19% rate on Thailand. Secondly, we have lowered the upper end of the range for the headwind from commodities by 50 basis points to now sit between 1.5% and 2% headwind. And that's because the hedge ratio for this year is now between 95% and 100% versus previously between 90% and 100%.

And finally, you will also note that we have accounted for some one-off cost amounting to between 50 and 100 basis point related to the transition to platinum plated curing. And that includes, among others, additional resources that we need to drive this forward at high speed, some inventory write-downs, some tech investments, et cetera.

And that's one more thing that we wanted to make sure you are aware of in terms of the EBIT margin. We mentioned back in the full year announcement that the guided decline in the EBIT this year would be most visible in Q1 and then gradually improve sequentially. But due to this cost phasing that I mentioned earlier on, which helped the first quarter, this has changed things slightly, and we now expect the year-over-year decline in the EBIT margin to be most visible in the second and third quarter and then be much less material when we get into Q4. Next slide, please.

Now we will transition a significant part of the business from silver to platinum plated in the year to come. And we thought it would be good to help you visualize this transition a little bit better. The chart on the right on this slide is meant to help you visualize the transition to platinum plated and the related reduction of our exposure to silver. And just a few comments on this.

As a starting point and in line with what we said previously, we will transition 80% of the silver revenue to platinum plated jewelry. So that's 80% of the 65% number that was shown in the left column on the slide here.

Then in '27, we will transition roughly half of that 80%, and that's the red part of the middle column. And then in 2028, we will transition the remaining part of that 80% from silver to platinum plated. The end game after the transition to platinum plated will be that our P&L and margin exposure to commodity prices will reduce significantly. And that's because the exposure to silver will decrease far more than the exposure to platinum will increase. This lower commodity exposure will be partly offset by higher labor cost as it requires more cracking time to work with plating, but labor cost is a more stable and predictable cost element than commodities.

Next slide, please. So, let's see what this transition means for Pandora's profitability. And some of you will remember this bridge from back in February. We are on track. There's no change to the message. So, I won't spend too much time on this slide. But we want to emphasize once again that with this transition, Pandora will remain a structural high-margin company. And you can see that on the slide to the far right, where we show that we expect to get to more than 21% EBIT margin in the midterm. So, in essence, this means that there will be no fundamental changes to our financial model.

As you saw on the previous slide, the transition to platinum as such will probably be finalized during 2028. But before we get production scaled, optimized and fine-tuned to the level where we will hit the above 21% EBIT margin, we need a little bit more time. For 2027 specifically, we continue to target an EBIT margin of at least 14% before one-off cost and at least 12%, including those one-offs. And we know that some of you have already noticed that the bridge here is based on the silver price of $82, which is where the prices were when we initially issued it back in February.

The spot rate this morning is a little bit lower, but it doesn't change the overall messaging. Because remember that during this transition, our sensitivity to silver in '27 will drop to around 14 basis points of EBIT margin for every USD 1 move on silver prices, down from 30 basis point just a few years back. And that sensitivity drops even further to around 6 basis points after the transition.

And on that note, I will hand back over to Berta.

Thanks [Thanos]. So, to conclude this call, let me just highlight a few key points. We have started the year in line with expectations. That is not to say that like-for-like growth is where we want it to be, but we are very clear on the actions require and we are moving decisively. This includes a step change in how we approach design, marketing and go-to-market execution in selected markets.

We are seeing encouraging signs in some areas, and we are scaling these actions more broadly. Importantly, our brand remains strong, which give us really confidence in our ability to deliver on these actions and build sustainable growth. At the same time, we continue to demonstrate a strong cost discipline, offsetting a significant part of the external headwinds. As a result, profitability remains solid.

We are also taking actions to protect profitability over the long term, including the rollout of our platinum plated offering. Looking ahead, we continue to target -- midterm EBIT margins above 21% as Andres was explaining, while generating a strong free cash flow. So with that, I just want to thank you for your attention, and we can open now to the Q&A.

[Operator Instructions] The first question is from the line of Chris Swann from UBS.

It's Chris from UBS. I'll do two. The first one on regional trends. If you would be able to share some regional color within that flattish like-for-like in Q2 to date in terms of which markets are outperforming, which markets are relatively soft? And connected to that, could you please elaborate on the markets that accelerated in Q1 within APAC and Latin America or if we look at if we look at Rest of Pandora, which was impressively up 7% in Q1. Just trying to understand a little bit more on the exact market that has been driving that acceleration sequentially.

My second one on margins. So Anders, you clarified that the margins this year are expecting -- a more meaningful year-over-year decline at EBIT level in Q2 and Q3. I'm just wondering if you can help us a little bit more on quantification of how we put that 200 bps cost saving bucket of Q1, how do we put it into Q2 and Q3?

If I take the first one, Chris, and then hand over to Berta and then Anders in that order. We won't go into too much detail on April. But for now, you can just see the trends are broadly consistent with what we saw in Q1. So yes, Latin America, Asia Pacific still doing reasonably okay and offset slightly by some weakness elsewhere. So more of the same really, Chris. And on that note, I'll hand over to Berta on Latin America and Asia Pacific, specifically in Q1 and what drove that?

Yes. In Q1, pretty much every market in Latin America was growing. So just name a few, we had Argentina, Brazil, Colombia, all growing in Q1 and Mexico was about flattish to 1%. So good performance across all the region. In Asia, the biggest contributor was Japan, where we got a big growth, like-for-like of 220%, but we also saw growth in Taiwan, Hong Kong and Singapore as well. So these are the main countries that we grew in Asia. And with China, by the way, delivering a slight growth as well in quarter 1.

And Chris, to your question about the EBIT margin phasing -- it will be Q2 and Q3 where you will see some of that -- all of that 200 basis point coming back and more so in the third quarter than in the second quarter. That's broadly the storyline. And this -- yes, I'll leave it at that.

And sorry, if I can just follow up on that Latin American comment. I think in the press release, you mentioned a bit of price repositioning. So are you able to help me a little bit on how much of that like-for-like strength is coming from price and how much is coming from volumes actually?

Yes. One of the things that we have done in the LatAm region is that Latin America until quarter 1 this year it was running in a different price corridor. So the prices in Latin America were in average 50% higher than the rest of the world, and the strategy was a high low. So basically high prices and then a lot of promotions. So what we have done is actually bring back Latin America in line with the global price corridor. So you can -- a consumer can compare similarly in the U.S. or European prices. That's what they are getting in LatAm. And at the same time, we are reducing the promotions.

So what we see is really that this is impacting -- it's been the main driver of the 6%. Just for information, I don't know you remember, we talked about it, I think, in the quarter 4 call. We did this after having run an expensive test in Colombia. So seeing increase in Colombia in quarter 1 after more than six months running this strategy, it is definitely delivering the growth that we are announcing now on like-for-like.

The next question is from the line of Lars Topholm from DNB Carnegie.

I will also stick to two questions for now. So Berta, you highlight all the strategic initiatives you're taking, but also highlight that 2026 is a transition year, but that your strategic initiatives should lead to stronger like-for-like growth and be with full effect during 2027. And I'm not asking for 2027 guidance, but just as you have very specific targets for long-term profitability, can you elaborate a bit on what is the success criteria for this exercise should like-for-like return to, what should we say, the old CMD targets of mid-single digit? Or what would you be satisfied with? And when should we begin to see this?

And then a question number two goes to platinum plating, which I understand initially, you plan to test in Holland. And then you decided not to do that anyway. So I just wonder if you can put some comments on that. And maybe in connection with that, I also comment on what Anders said that there have been some write-down. Was that on platinum plating?

Okay. So thank you, Lars. Sorry for interrupting you before. You did have right to two questions. Thank you. Yes. So on the long term, this is my ambition is to bring Pandora to the success of Pandora, which is the mid-single-digit growth. And this is what we are all working towards. And as you rightly say, in 2026, we are activating as much as we can, but design and product development, which is the key one, is taking us a little bit more time. So that's it.

On the platinum plated, the plans are still to test in Holland. We did have a delay for commercial reasons. One of the things that is key when we introduced this to the consumers, and that came very clearly on all the validation that we did is that water resistance as well as the tarnish resistance, the fact that they can take it to the sea water, it was critical. And then we did have a delay on one of the certifications for the water resistance. Therefore, we are just moving to the next cycle. So everything is still on plan to roll out this year, still in Holland and other markets. And the transition in 2027 is still on plan and on time. Anders?

Fair question on that Lars. The inventory write-downs that sits in this one-off cost bucket profit is not on the platinum plated products, it's on the expected remelt of silver products happening next year. The way that it works from an IFRS perspective is that even though the transition will only start happening next year, so the physical remelt, so to speak, of silver jewelry will happen in '27. Then so once the decision has been made, then the cost will have to be taken already in 2026. So that -- it's really that inventory write-down is related to the expected remelt of silver products next year as part of the overall transition.

And how much does it hurt earnings this year?

It's included in this 50 to 100 basis points overall. It is one of the reasons that we have a range is that there is some uncertainty exactly how much is the inventory write-down going to be. There will be some -- there's also some levers to minimize it and avoid doing too much. But of course, when you transition over a couple of years, 50% of your revenue from a product being produced in one way to another, there will be some write-downs. But exactly how much we can reduce is still to be seen. So that's why we will keep a range on that one-off cost.

The next question is from the line of Daria Nasledysheva from Bank of America.

This is Daria from Bank of America and I have two questions. First one, you saw a meaningful acceleration in Asia and like-for-like revenue momentum. And while you mentioned changing the go-to-market strategy in Latin America, what has changed in APAC for you? Is it better underlying macro? Or are you also changing something in particular to really accelerate growth there? What are you doing differently in Asia compared to history when this was really a more challenging part of the business?

And my second question would be on main European markets. When do you think we can expect an inflection there, considering also some strategic changes that you have been implementing across those geographies?

Yes. Thank you. I'll take both questions. Thank you. On Asia, we are basically focusing on it. And let me just elaborate on that. On the Southeast Asia, we operate mainly through distributors, and we basically now open a new office in Singapore, and we have dedicated teams working with the distributors to drive growth. Not long ago, we just have a distributor summit to bring them back all the growth plans that they could get and all the tools for Pandora. So focusing on those distributors. On Japan, it's an owned and operated market and there we are implementing our marketing model of reach and relevance. We have increased marketing budgets to continue to increase the awareness of the brand and we are working as well on with local cultural relevance activation in Japan. So very simplistic, implementing what we are saying that we were going to do and doing that in Japan, either in owner and operated, but also focusing on the distributor markets. That's for Asia.

And your second question on the European market. Well, it is basically the whole diagnosis that I presented in quarter 4, and I have briefly remind everyone. While it's true that we are starting to do certain things into 2026, we cannot really activate the biggest pillar, which is new product development in our core. The plans for that will start from 2027. Rest assured, I'm doing everything I can with the teams in Pandora to see if we can accelerate something for quarter 4, but we need basically the entire program, which is product and marketing to be able to start delivering. So 2026, we expect still to be a transition year in Europe.

Markets of Europe, of course, we have still Spain and Poland and Turkey and all that growing at high levels, but especially in the mature markets like U.K. and Italy.

The next question is from Andre Thormann from Danske Bank.

I just have two. First of all, on lab-grown diamonds, I wonder if you can elaborate a bit on the second quarter of quite a bit of decline in that category. What are you seeing there most particularly in U.S., I guess? And then second, on the remelt, I wonder if you can talk a bit about why this won't be a tailwind rest of year as well?

Yes. Should I start on the diamond? Okay. So on diamonds, I think you were talking about our performance or the market, our performance, right? Yes. So what we see on the lab-grown diamonds is that we are actually sharpening the strategy. So we have a part of our lab-grown diamonds where the high carats, so the one carat, the two carat at high prices.

So for the consumer, there are not many that come to Pandora to spend $1,000 to $1,500 and above. So that part of the business, we are slowing down and is a big chunk of the decline. However, what we are investing now is on what we call the micro fine diamonds. So where the sweet spot of pricing is between $250 on rings and a small pendant. That part is growing, and this is the part of the business that we'll be focusing on from now on.

So really and if you look at that price between the $200 and $500, actually, the like-for-like is positive in both in value and units, whereas it's declining on the above $1,000, and this is, of course, now carrying the entire business down.

And then Andre, on the question about write -- remelt write-down for the rest of the year, it's actually a good question, well spotted. When we made the guidance originally three months back, then in the budget in the way that we did the guidance, the remelt cost for the year was based on a silver spot price of $82. That was the spot price back then. Now it's $75 based on the assumption in the updated guidance as of today. So that gives a little bit of more headwind compared to when we made the guidance three months back. So that's why that remelt upside basically nets out for the remaining part of the year compared to the original assumption. The logic works the other way around, when we speak about remelt, then a lower silver price gives a little bit more headwind.

The next question is from the line of Mr. Charchafji from BNP Paribas.

I have two, please. The first one is on the gross margin phasing. Do you expect any disruption in Thailand and Vietnam facilities stemming from the conflict? And would it be fair to assume gross margin ex the 100 bps one-off so 78.5% to be rather similar in the next three quarters with the plus and minus between the component? My second question is on space, given the performance that you are delivering versus guidance, but also it was the case last year. It seems that you -- that your new openings over the past 12 months are performing quite well. So just curious to know if going forward as a space in terms of the like-for-like, would you say that the like-for-like will be even more supported by those? And if it's -- if there is anything to keep in mind on this?

Thanks for those questions, Anthony. On the impact on the gross margin, if I understood the question correctly, then the way to think about it is, of course, we do spend some energy. We have energy cost in the P&L. We do have some freight cost in the P&L. But it's in the big scheme of things, it's not a lot of money. So there will be some -- a little bit higher cost, but not something that has been big enough for us to talk about it as part of our guidance and in the gross margin.

In -- we don't have any critical suppliers in the Middle East. So for that perspective, we're also okay as well. In general, I think it's also maybe worth noting that the electricity supply in Thailand as a country is not that dependent on the Middle East. It's -- if I understand it correctly, it's just around 10% of energy or electricity in Thailand that comes from the Middle East. So it's -- so net-net, we are not that exposed apart from fuel through the consumer behavior, obviously, and the macro.

On the question about the good performance on the stores that we have opened, I think the way to think about it is that it's the -- when -- as you know, during the first 12 months of a new store being opened, it counts in organic growth only, not like-for-like. But now we're just getting a bigger base to start from to calculate like-for-like once the stores have been opened for more than 12 months. So as a like-for-like contributor, so that's not a factor.

The next question is from the line of Grace Smalley from Morgan Stanley.

Q1 and the slowing you've seen in recent quarters in the U.S. Do you attribute that slowing fully to macro and what we're hearing in terms of the K economy? Or have you also identified any sort of Pandora-specific factors that are also playing into that weakness into the U.S. and any actions that can be taken to help drive improved trends in the U.S. outside of relying on improved macro?

And then just a follow-up on the implications from the Middle East. I appreciate the situation is changing very quickly and you've spoken through the supply chain considerations. But could you just also comment on whether you've seen any knock-on impact on -- from the recent developments on consumer sentiment in any of the European markets in the last couple of months?

Yes. So let me -- so on the U.S., yes, we do see the impact of the macro and the K-shape economy as you were referring to. What we see is that the consumer sentiment is disproportionately degrading with the middle and the lower income. As a reminder, Pandora over-indexed on middle income. So of course, this macro is not helping us.

What we see is a decline in traffic fundamentally. Conversion and average basket and all that remains pretty much stable, but what we are really seeing the impact is on the traffic. But again, we are not just standing still. These are the things that we cannot control, and that's why we continue to invest in the U.S. that are the plans as well for this year and continue to bring excitement and marketing and product, et cetera.

The second question was on -- yes. And again, how much of that is coming because of the Middle East and how much is impacting what we -- I cannot say. What I can say is that it was already declining in quarter 4 in the U.S. and it continues to deteriorate. Of course, the situation on our consumers' daily life with high oil prices, all that is definitely having an impact. The amount of disposable income that they may have for discretionary categories may be impacted. How much I cannot tell you.

In the Europe, what we are seeing is that it's been low. We haven't seen a major deterioration in quarter 1. It's not improving. It's not going down, but it's still stably low, especially on the market that we are having some trouble like U.K., et cetera.

The next question is from the line of William Woods from Bernstein.

The first question is just on pricing. Could you just comment on how much pricing you've put through in quarter 1? And then just interested in EMEA, specifically, obviously, on the two year stack there's a bit of slowdown there in the like-for-like. How much pricing have you put through in EMEA? And do you think the elasticity there specifically is still around 1%? Or do you think you've seen a deterioration in the elasticity?

On the first question, hi William, on pricing year-over-year in Q1 is to the tune of 4% as a global number -- global average number. It's not new. It's this year, Bilal just clarifying. It's the year-over-year numbers. So it's not the Q1 action. We actually didn't change pricing during the first quarter. But year-over-year, based on the actions that we've done prior 12 months, it's a 4% ASP uplift and thereby, with a 0% like-for-like in the quarter, then units are down equivalently.

Understood. Any comments specifically on EMEA and the elasticity or anything to say?

Yes, it's broadly in line with the expectations we have. We say it's around 1 the elasticity in EMEA as well. So no change at all in that.

The next question is from the line of Thomas Chauvet from Citi.

My first question on tariffs, Anders, perhaps. Can you indicate the status of your tariff fund with the U.S. administration? I think you talked about this earlier this year. What is the amount that you claimed? And is any of that part of your margin guidance or completely? Secondly, on your 2027 margin guidance, have you started hedging silver? And if so, at what price?

And just a follow-up for Berta on North America, please, and the LFL turning negative. You come back to the new pricing strategy in the U.S. and how the consumer is responding. And if you're not touching the entry price points, is it why perhaps there is a bigger gap now between Fuel with More gross margin, which I think was stable and core where you have a lot of chance, I think, where prices are not touched. I think the GM gap between the two has widened in the first quarter.

Thanks, Thomas. I'll start out with the margin questions. On the tariffs, the gross amount of tariffs that we've paid under the IEEPA scheme is just above USD 70 million. And in our guidance, we have not assumed that any of that will come back. So that if that should happen, then that will be an upside to the guidance whenever that might happen one shiny day. The only sort of upside on tariffs that we have built in is the temporary lower tariff level during this 150 days pause that runs until, I think it's early July, mid-July.

On the silver hedging, you're right that now with a little bit of additional hedging that we've done since we met last, there is some of the P&L for 2027 that is hedged. And if you dig into the bottom of the company announcement, you can see that the first quarter of '27 the P&L is hedged at a blended rate of USD 46. So if you took that specifically into the '27 margin guidance, then that would translate into 70, 80 basis points of EBIT margin upside for next year. That's not built into the slide in the investor presentation yet. But as we're not specifically guiding for next year, but on an isolated basis, 70, 80 basis points of upside for next year locked in.

Yes. I think on the gross margin of Fuel with More is basically driven by the growth in Timeless. So Timeless is today 80% of Fuel with More. So because Timeless has been growing, then the gross margin of Fuel with More is growing. It's as simple as that.

The next question is from the line of Kristian Godiksen from SEB.

So just a question on the platinum plated products. So based on the website in the Netherlands, you had up for a short while, can you confirm the intention to raise prices for the silver products and that this is not included in the margin bridge? And then furthermore, on the decision of the platinum plated products to be priced at a 1:1 to the silver prices as the price today. And just wondering based on precious metal plated products today are already priced higher than the solid silver prices you have. So, and then furthermore, the platinum plated products, they have better capabilities, both in terms of water and tarnish resistance, so which are important to consumers. So wondering why these products are not priced higher?

I think I got all the questions, but we had a little bit of a noise here, but if I missed something on my answer, please correct me after I have finalized. Yes. So we can confirm that the test that we are putting this year will be about raising silver higher than the platinum plated products. The reason for that is very simple. Silver prices are increasing. And if we keep them at the same price, our gross margin will severely deteriorate. So we are really trying to understand that.

Having said that, the reason why we are keeping the platinum plated as well versus silver, it came out of all the extensive testing that we did last year. As a reminder, we went to 35,000 consumers and what the consumer willingness to play -- to pay for the platinum plated product was actually slightly lower than for solid silver. So we are pretty much respecting the learnings. Again, having said that, we will learn more from the test that we are going to be having into this year. That's why we are testing and not going straight into rollout. So if the insights are different, we'll come back on that, of course.

The next question is from the line of Piral Dadhania from RBC.

So I just have one question on the P&L profile and margin composition. So as you move towards a midterm EBIT margin of above 21%, we were just wondering what level of gross margin that would assume and how we should think about the evolution of operating costs as the business transitions to its new raw materials mix?

Thanks for that question, Piral. I think in broad terms, you should think about it as the gross margin coming back to the level where we will be in 2026. This year, we have guided for an EBIT margin of 21% to 22% and basically saying that that's where we're getting back to in a couple of years. And structurally, there will be no difference between GM and OpEx ratio. So implicitly, we are saying that the gross margin gets back to where we will land this year.

Now we're not specifically not guided for where the gross margin sits this year, but it will be in the very high 70s. That's the way to think about it. So in a way, if you look at the -- on the surface on the P&L in a couple of years, it will look very much like today. It's just if you double-click on the cost of goods sold, then there will be a different commodity exposure. It's more diversified and lower than what it would otherwise have been. And then there's more labor cost sitting in the COGS. But otherwise, it's the same business.

And -- so just as a quick follow-up, if we may. Like could you just help us understand why you have higher labor costs? Sorry if we may have missed that, but is it just a more complicated process? Is there more labor cost per unit in terms of the manufacturing side of things? Yes, any help there would be greatly appreciated.

Super fair question. The way to think about it, if you produce a charm in silver today, it's one process in a very simplified finance language. But if you then produce it in platinum plated going forward, you first produce the core, which is basically the same as doing the silver solid charm. But then on the platinum, that's a step two where you need to sort of add the plating process, which is somewhat labor-intensive. So it's the second step that adds the labor cost going forward, just like on our gold-plated products today.

Totally. And I just think to add, Anders explained it very well, but important to note that, that's why we've been working on the signature alloy that we call Evershine because then it can behave the same as silver and therefore, the first step of the production will not suffer or will not be impacted. So it's only on the second part, which is just the plating part.

The next question is from the line of Erik Sandstedt from Kepler Cheuvreux.

Two questions for clarification. Firstly, could you just repeat what you said regarding the inventory buildup? Where should we expect inventories to end up? And how long do you expect it to take to normalize it? And are there any offsetting effects on working capital? Or should we basically expect the inventory buildup to fully flow through into higher working capital?

Yes. Thanks for that question, Erik, very valid. On inventory, last year, total inventories ended at DKK 5 billion. End of this year, think about it in round numbers as being going up to around DKK 8 billion, so from DKK 5 billion to DKK 8 billion. And of that DKK 3 billion increase, DKK 2 billion is very mechanical. It's simply that silver and gold prices will be higher plus the tariffs that will be sitting on inventory. And the other up to DKK 1 billion will be -- most of that will be driven by that we are getting ready for the platinum plated transition. So we, at the end of this year, both be holding silver jewelry and platinum plated jewelry for the same designs.

And then the last but smallest piece is that we have, in a couple of areas, decided to increase inventories to reduce the amount of stock outs, so improve the stock availability in the stores. So that's the '25 to '26 journey. Then we will stay at that elevated level through '27 as we go through the transition and then step-by-step through '28 and probably into '29, maybe even that's still to be determined, we will get back almost towards the level that where we started out, not -- probably not all the way down to five, but somewhat above that. So that's -- I know that's very round thinking, but that's the shape of it.

And you're, of course, very right that when you pay more for your gold and silver from the refiners, yes, it hits your inventory, but our trade payables will go up as well. So that's an offsetting effect. And I'm just looking at my IR colleagues here so maybe you remember, but I think underlying the net working capital, the way to think about it is underlying, we ended at minus 1% last year, and we're going to end at mid-single-digit-ish this year. So a 6% to 7% increase in net working capital. And I'm just doing the math here on -- in my head.

So the DKK 3 billion increase in inventories, let's call that 10% increase. And then there's 4 percentage point-ish going the other way with trade payables, not the least, leaving a net increase in net working capital of around DKK 6 billion. I know there's a lot of numbers verbally. I hope it makes sense, Erik. Otherwise, happy to follow up.

That's great. Very helpful. And then just finally, on the 50 to 100 basis points transition costs that are included in your 2026 margin guidance, just to basically confirm, are these -- these are not incremental to the costs already communicated for 2027? Or does it reflect the phasing so that the transition costs will be lower in 2027? Just wanted to double check that.

It's good that you double check on that. It is -- our current thinking is that it's incremental. So on top of the two points of one-off cost transition cost next year. And a couple of things. It is -- we need even more extra labor during the transition than what we thought a couple of months back. And we want to -- so that's one element. The tech cost in making the systems, our systems able to handle the transition, and I can elaborate on that if needed, but that requires a bit more tech cost than what we had thought. And then we are building, honestly, a buffer for potential inventory write-downs when we sort of stop selling silver, then how much is left on inventories, and how much do we need to remelt, building a little bit of buffer there because it is a big transition. So long story short, the 50 to 100 basis points is on top of the 200 basis points next year.

Next up, we have a follow-up from Lars Topholm from DNB.

Yes, it's actually related because you, of course, suspended buying back your own stock because of the margin pressure, which is temporary, but also the higher need for working capital. So, how should we think about when you might be able to resume share buybacks? It's obvious EBITDA will be lower in 2027. But are you willing to temporarily increase leverage, knowing that that will be a trough and then margins will ramp up again? Or have any view on when you could begin buybacks again?

It's a very relevant question, Lars. And I think that the short answer is yes. I think that there could be a situation where we say it's okay to have a higher leverage than the capital structure policy for a short period of time. But if we started -- went out initiating a share buyback program today, then we would be above the capital structure policy for, let's say, two years, which is probably too long also for the credit agencies to think that, that's a good idea. So we also have that in the back of our mind. But could there be somewhere in between where we say now it's x quarters, where the leverage might be a little bit elevated, not too crazy, but a little bit elevated. I think that could be. But before we reach that point, we're still some quarters down the road.

Yes, of course, I realize that, but I could just foresee a '27 where your CapEx will come down because your platinum plating investments peak this year. And also, if you see the jump in working capital this year and then, let's call it, stable next year, then your cash flow from operation should improve quite significantly. So you would be looking into potentially a big free cash flow acceleration in 2027. But is it completely far out to discuss buyback in 2027?

I think the way I would answer, Lars, is that the hurt on the net working capital this year and inventories that will come back at a point in time. So there will be -- as we are in the unfortunate situation that we don't do a share buyback this year, that will also likely be a point in time where you can do more than what you would normally do because your inventories and net working capital is building back down again. Exactly when that comes and triggers a share buyback, it's too early to talk about it at this point in time.

And the last question for today's call is from Kristian Godiksen from SEB.

So just in relation to the confidence level you have in terms of the newness resetting design in order to trigger an acceleration in like-for-like. That will be the first one. And then maybe following up on that, I guess also, should you not see a step-up in like-for-like in the fourth quarter due to newness, both in terms of the new designs coming in, but also the expansion of the Talisman, you comment are something that consumers take well in, and then also the easier comps.

And then maybe the second part of the question would be if you could comment a bit on the expected split in terms of design variations launched within the different aesthetics going forward?

Yes. So let me just try to address this in a synthetic way. So the impact of the newness that we are seeing so far is that when we have launched distinctive newness, the consumer is responding to it. So again, we have just seen Talisman, we have seen Bridgerton, and we have seen Essence. So we know that when we do it, the consumer respond positively. So the level of confidence is high.

What is coming on the rest of the year, you will have to be patient and see what we are doing. But rest assured that whenever I can accelerate, we are doing so. As a reminder, our development timing, you can have a point of view, whether it's long or short, but it's about 18 months from a sketch to product in market. So again, trying to do our best with those development times. And then for the rest of the year, we are keeping guidance. It's too early to know how the world is going to develop. That doesn't stop us from keep working at it, but I cannot say anything else.

Okay. And on the expected split in terms of design variations within the different aesthetics?

Sorry, yes. So there, the way you need to see, again, I'm not going to go into my whole collection plan and line plan by aesthetic, but the way to think about it is that the first priority is that we need to address what is happening on our core business. We need to make sure that our core business, or the playful aesthetic continue to be refreshed and exciting. And that's why the small program that we have -- we are launching, Pandora Wonders, is exactly doing that. It's playful aesthetic. It play exactly into Pandora DNA, and we are bringing a step change in creativity that is not what consumers is looking forward to. So that will be, by all means, our number one, number two, and number three priority to bring that core back to growth.

And then on the remaining, you will not -- you should not expect us to moving into more aesthetics. So you have them in that chart. So the bold, the playful on that, it will be pretty much equal weight. So disproportionate on playful.

Okay. And then just a very short follow-up. Just in terms of the first time for a very long time that online was worse than the physical stores. Were there any specific reasons for this? And do you expect this to continue?

Sorry, we saw that decline mainly coming from the U.S., and I can only say what we just said before. We are seeing really a tough situation over there. It's impacting both. So yes, you see that happening mainly in the U.S. We haven't done anything differently, seen anything differently, just traffic going down both online and offline.

Thank you very much, everyone, and we hope to speak to you in August. Thank you. Take care.

Good morning, and welcome, everyone, to Pandora's Annual General Meeting 2026. My name is Peter Ruzicka, and I have been Chair of Pandora since 1st of January 2020. As a reminder to today's Annual General Meeting, it will be conducted in English, and that is in accordance with our Article of Association. As a service to our shareholders, simultaneous interpretation between English and Danish will be available during the meeting.

I would like to draw the attention to the disclaimer on the screen. The key point is that the presentation may include forward-looking statements, which are inherently subject to uncertainty. Before I introduce today's speakers and we move on to today's agenda, I would like to take a moment to sincerely thank Alexander Lacik for his outstanding contributions as CEO of Pandora.

As some of you may remember, Alexander last year announced that he would be retiring as CEO of Pandora. And in that context, we also announced Berta De Pablos-Barbier as new CEO of Pandora, who assumed responsibility since 1st of January 2026. Under Alexander's leadership, Pandora successfully navigated a period of significant transformation, strengthened its global brand and delivered strong results for our shareholders. On behalf of the Board, I would like to express our deep appreciation for Alexander's dedication, his strategic vision and tireless efforts over the past years.

So now I would like to introduce today's speakers. Joining me are our Chief Executive Officer, Berta De Pablos-Barbier; and our Chief Financial Officer, Anders Boyer. Together, Berta and Anders, they make up Pandora's executive management. 2025 has been a turbulent year for Pandora, marked by a challenging consumer environment. As I mentioned, Berta was recently appointed as Chief Executive Officer and has already shared an initial strategic update as part of the Q4 and full year announcement earlier this year.

Berta and Anders will provide further details on the business development later today. For now, I would like to thank them both for their strong contribution and efforts in 2025. In accordance with our Articles of Association, the Board appoints the Chair of the Annual General Meeting. And the Board has appointed Pernille Dalhoff from Kromann Reumert to serve in this role also this year.

So with that, I will now hand over to Pernille, who will guide us through today's agenda and ensure that all formal requirements are met. So Pernille, please.

Thank you, Peter, and thank you to the Board for appointing me as Chair of Pandora's Annual General Meeting. I look forward to a good meeting today. Before we would begin, I would like to inform you that this Annual General Meeting is being live streamed via Pandora's shareholder portal. So that means that any shareholders who ask questions will be shown online and a recording of the meeting will be available on Pandora's website after the meeting.

As Peter mentioned, my first task as Chair of this meeting is to check that this meeting has been properly convened. And according to the Articles of Association, meeting shall be convened giving not less than 3 and not more than 5 weeks' notice by advertisement on Pandora's website and e-mails sent to all registered shareholders having so requested. And Pandora has informed me that on February 6, notice was indeed sent by e-mail to the registered shareholders having so requested, was announced in a company announcement and was also published on Pandora's website.

Furthermore, the complete proposals for consideration today, including the proposed new Articles of Association, Pandora's annual report for '25, the remuneration report for '25 and forms for notification of attendance and proxy and postal votes have also been available on the website since February 6. On this basis, I conclude that all requirements under Pandora's Articles of Association and applicable legislation have been complied with, and this Annual General Meeting has been properly convened and is competent for the transaction of the business on the agenda.

Any comments or questions to this formal part? Then I conclude that this Ordinary General Meeting 2026 is properly and lawfully convened and competent for the transaction on the business on the agenda today. And I can inform you that of the 79 million shares, a total of 51.6 million is represented here today, equal to approximately 69% of the share capital and votes.

If you would please take a look at the agenda for today's meeting, item 2 and items 4 through 8 may be passed by a simple majority of votes. And item 3 regarding the remuneration report is subject to an advisory vote only. Item 9 includes 4 proposals by the Board. Item 9.1 regarding reduction of the share capital by cancellation of treasury shares and Item 9.3 regarding amendment of Article 7.3 of the articles require the affirmative vote of at least 2/3 of the votes cast and of the share capital represented here at today's meeting.

Item 9.2 regarding authorization to the Board to increase the share capital with preemptive rights for the shareholders and item 9.4 regarding authorization to me as Chair of this meeting to register the resolutions made here today may be passed by a simple majority of votes. Items 1 and 2 on the agenda regarding the Board's report on the company's activities for '25 and the approval of the audited annual report for '25 will be dealt with jointly like we normally do here in Pandora, and the remaining items will be addressed one by one.

And before I give the word to Peter to present the Board's report on the company's activities during 2025, a short review video will be shown.

[Presentation]

Before I go into the strengths of the business, I want to address something that is clearly on many shareholders' minds, the value development of the company during 2025.

Pandora has been on a long-term growth journey, but we ended 2025 below our own expectations. Together with external headwinds, including higher silver prices, foreign exchange movements and tariffs, this impacted market sentiment and contributed to a material decline in our share price over the year. The Board takes that development seriously. At the same time, we remain confident in Pandora's long-term opportunities and by the fundamentals of the business. Our scale, brand strength and resilient business model.

With that context, let me briefly highlight where Pandora stands today. In 2025, Pandora is the world's largest jewelry brand with revenues of DKK 32.5 billion and more than 112 million pieces sold globally. We are a brand with broad appeal, serving women across generations and markets worldwide. Our crafting operations in Thailand remain a key strategic asset. They represent the largest branded jewelry crafting facility in the world and are industry-leading in terms of scale, craftsmanship, efficiency and skill level.

At the same time, we continue to set high standards for employee well-being and environmental responsibility. We are also progressing well with our plans to establish a new crafting facility in Vietnam planned to open in the second half of 2026, and that will further strengthen our long-term capacity and resilience. Pandora's global store network is extensive and profitable with more than 7,000 points of sale across over 100 countries and is fully complemented by a strong online presence.

In 2025, we recorded more than 915 million visits across our physical and online stores. Together, this gives us a truly global mass distribution across both physical and digital channels. Sustainability remains a core pillar of Pandora's strategy and value proposition. We are committed to being a low-carbon business, advancing circular innovation and fostering an inclusive, diverse and fair culture. In 2025, we continue to make solid progress, including sourcing 100% recycled silver and gold and further strengthening diversity in leadership.

Furthermore, in 2025, we achieved an EBIT margin of 23.9%, an organic growth of 6%. Based on our financial performance, we ask shareholders today to approve a dividend of DKK 22 per share. We will come back to that later, of course. All in all, this provides a strong platform for Pandora to capture growth, opportunities and create value in the years ahead. And as a part of her update, Berta will also explain how we are addressing the commodity and cost headwinds.

Further, I want to comment on the remuneration report, which is presented for an advisory note. We note the feedback received from shareholders leading to the remuneration report 2025 not being approved. The Board and the Remuneration Committee have carefully considered the input from shareholders. A few comments about the CFO award for which detailed KPI targets are not disclosed in the report. Firstly, the award is indeed tied up to value-creating KPIs, but for business sensitivity and confidentiality reasons, we cannot share all the details around the KPIs. However, we can assure you that we do what we believe is best for Pandora and our shareholders.

Before I give the word to Berta, I would finally comment on the Board evaluation. I can confirm that the Board conducted an evaluation of its performance and its collaboration with executive management during 2025. The conclusion and key observations were presented to both the Board and executive management and formed the basis for a thorough and constructive discussion. The outcome of the evaluation confirmed that the Board continues to be well established and well functioning, supported by a strong belief in the strategy and effectiveness in collaboration with the committees and executive management.

The Board is responsible for the company's strategic direction and the assessment of ESG-related risks and reflected in the governance illustration in the 2025 annual report. The Board receives a minimum of two annual updates on Pandora's sustainability agenda.

So with that, I will now hand over first to Berta for a business and brief strategic update and then followed by Anders, who will present an update on the financial performance for 2025.

Back, Peter. Bill [ comment ]. So this is my first Annual General Meeting with Pandora, and I have been really looking forward to this meeting today. I will start by giving you a brief overview of Pandora development during 2025.

2025 was marked by a challenging consumer environment. And while our growth came in below expectations, we see clear opportunities to improve our performance going forward. During 2025, during this year, Pandora delivered an organic growth of 6% with a like-for-like growth of 2% for the full year. Our core business remained very resilient throughout the year, and it was supported by different innovation, especially the successful launch of the collection Pandora Talisman.

The EBIT margin for the year reached 23.9%, supported by disciplined control and very effective pricing. This allow us actually to offset the vast majority of the pressures that we experienced during the year. Returns and earnings per share also remained robust. We delivered an EPS of DKK 68.1, representing a 5% growth year-on-year. All these results are telling us something. This underlines the resilience of Pandora's business even in a very turbulent environment. This provides a solid foundation as we are course correcting certain areas of the business during 2026 and beyond, and I will going to touch on that later.

Now let me turn now on the guidance for 2026. For 2026, we are targeting organic growth in the range of plus 1% to plus 2%. This reflects a like-for-like growth of minus 3% to 0%, supported by around a 2% contribution from our network expansion. Now let me very honest here. This is definitely below the level that we will aim to deliver in a very normal year. And this is mainly driven by two main factors.

First, we are not expecting any meaningful support from the macroeconomic environment, which remains very uncertain, and I'm sure you know, for our consumers. Secondly, we do see the need to step change execution in a number of areas that I will touch on later. Now on profitability, we are guiding from an EBIT margin of 21% to 22% in 2026. So this guidance reflects our continued commitment to investing in the business while maintaining strong margins supporting the long-term value creation.

As I mentioned previously, and Peter alluded to it as well, 2025 was a challenging year, but we continue to build our -- so we continue to build on our strong core while driving growth across other collections. In our core business, charms and carriers delivered 1% like-for-like growth for the year. So the core remains resilient, and it continues to represent still the majority of our revenue base. We were also very encouraged by the initial performance of our Talisman collection since its launch since 2025, which is really showing that with new aesthetic, we can generate appeal to attract new consumers and continue to bring the loyalty of our existing ones.

In our fuel with more segment, we delivered 3% like-for-like growth in 2025. Now that growth was supported by solid performance in our Pandora Essence, a collection that we launched 2 years ago and also on our lab-grown diamonds innovations and collections. For our design strategy, we have outlined initial plans on how we plan to reignite growth across both the core and the fuel with more. In Essence, this is going to be about sharpening our design priorities and introducing newness more deliberately across the portfolio, bringing greater creative energy to the core and more confidence as we Scale Fuel with More.

Now let's go to our regional performance. From quarter 4 2025, Pandora implemented a new geographical revenue disclosure format covering EMEA, North America, Latin America and Asia Pacific. This update was driven by the increased importance of markets previously grouped under rest of Pandora beyond the seven former key markets. So let me start with these results on this classification.

Firstly, EMEA is our largest region. Like-for-like growth was flat for the full year 2025. Performance really varied across markets. And while some delivered solid results, the overall outcome underlines the need for targeted strategic adjustment, which I will return to that shortly. At country level, Spain, for example, continued to perform very strongly, demonstrated that sustained brand strength can continue to drive growth even in markets where we have high market share. Italy, on the other hand, saw weaker performance, reinforcing the need for a more decisive shift in how demand is activated in our mature markets.

In North America, like-for-like growth was 6% for the full year of 2025, where consumer confidence and store traffic were impacted by the macro environment. Now that said, brand strength remains solid and the long-term opportunity in the U.S. remains unchanged. Latin America delivered a minus 4% like-for-like performance in full year 2025. A new pricing architecture was implemented in January and early responses are encouraging for us. Lastly, Asia like-for-like growth was 1%, but with Japan continuing to perform well and providing a positive reference point for our future approach for the region. A clear priority for Pandora and For Me remains, of course, the role of our stores and the role that they play in driving desirability and strengthening how the brand is perceived for our customers.

By the end of 2025, approximately 800 concept stores have been converted to the new format, reinforcing Pandora as a desirable jewelry brand. Now looking ahead, we do continue to build on this progress, including rollout of new digital window displays across selected stores to increase the visibility to support the storytelling and to attract traffic. At the same time, like any strong brand, we will not stand still. We see future opportunities to evolve as well some tweaks on our store layouts, improving traffic, and presenting Pandora even more clearly as a desirable jewelry destination.

Now as I anticipated, let me just move now to more of a strategic update. As CEO, my focus is to continue to strengthen the brand desirability and to deliver sustainable long-term like-for-like growth. This chart illustrates how we are evolving Pandora growth engine for its next phase. Our focus continued to be to recruit new consumers into the brand. That remains unchanged. What has evolved is our understanding of what truly drives that recruitment as both the brand and our markets mature. Under the Phoenix strategy, we rebuilt the foundations of the business. We strengthened our core collections. We rebuild brand awareness through paid media. And as a consequence, we delivered a strong like-for-like growth. That work was essential, and it has brought us to where we are today.

Now what brought us here is not what will take us forward. As Pandora matures, growth is increasingly driven by desirability, not reach alone. In response, we are sharpening our growth engine around three interconnected pillars. Design, brand and markets. Let me start by design. Design drives desirability. So on design, our priority is to reenergize the full portfolio. Our collections need greater distinctiveness to reignite desirability, while our smaller and underrepresented collections require more depth and breadth to scale their growth. On brand, we are shifting from awareness led paid reach only towards paid reach and cultural relevance. So earned media becomes now a core KPI, improving efficiency while driving traffic, demand activation and conversations about Pandora.

Now on market, we are moving away from a one-size-fits-all approach, and instead, we are calibrating the growth engine by market maturity, prioritizing desirability in high penetration markets while continuing to invest in reach where penetration still remains lower. Now let me be very clear. This is an evolution. This is not a reset of what Pandora is. It simply builds on what has worked and strengthened Pandora growth engine, and we are just shifting some tweaks for the next phase of Pandora value creation. Now of course, this is all about driving the top line growth, and of course, this is essential. But now I am very sure now that you are aware one of the big headwinds that is facing the industry and that we have been navigating in 2025.

And this is, of course, the rising silver price. I would like just to explain how are we addressing this challenge. While we continue to deliver a superior, insist a superior consumer proposition that remains fully aligned, I insist fully aligned with Pandora DNA. So we are doing this through a decisive product innovation that evolves our product platform and strengthen the long-term resilience of the business. What are we doing? We are expanding our offering with our platinum plated jewelry that is built on our unique signature proven metal alloy.

With this innovation, Pandora will be the first jewelry brand to bring platinum plated jewelry to market at a scale, which is combining the aesthetics of a precious metal with superior everyday performance. We have conducted comprehensive consumer testing on this proposition, and the results have been very encouraging for the consumer response. For Pandora, broadening its metal mix is highly accepted and expected from our consumers as the leader of a desirable accessible jewelry brand. This unique and proven metal alloy has been specifically engineering to optimize the platinum plate.

It delivers certified tarnish and water resistance. It is hypoallergenic and therefore, outperforms traditional silver in daily wear, which is really making it highly relevant for consumers today, while it's helping us reduce the exposure to silver pricing volatility. So with this brief introduction and strategic update, I will move now on another important aspect that you know we truly care about, and this is, of course, sustainability.

Sustainability is at the core of Pandora. We aim at being a low-carbon business, drive circularity principles in everything we do and act as an example of what it means to be inclusive and fair. Our objective remains to have carbon emissions across the full value chain by 2030 and to be zero carbon business by 2040. Now we have taken very important steps in 2025 with now a total 17% reduction in total greenhouse emissions compared to 2029. Now we also have continued to drive circular innovation in 2025, using 100% recycled silver and gold in the crafting of our jewelry. And this, of course, this reinforce our leadership in circular innovation in the jewelry industry. And we also continue to make progress on social sustainability. Women represent now 44% of senior leadership position. All our -- around our own operations run as well on 100% renewable energy.

So with that, I am going to hand over to Anders. Thank you very much.

Thank you, Berta, and good [ morning ], and welcome to everyone participating today. The table that you have on this slide shows our financial KPIs for 2025 compared to last year. And some of the numbers we've already spoken about, so I'll just call out a few of those. But overall, the numbers that you can see on this slide underscores that our financial performance remained solid for the full year, even in a quite challenging external environment.

And even though, as Berta said that we ended the year softer than our own expectations on the top line. In the year '25, we delivered organic growth of 6% and like-for-like of 2%, as Berta also mentioned. It was just to repeat that below our own expectations and the strategic initiatives that Berta just went through are designed and intended to course correct the business in a number of areas and get growth back at a higher level. Looking at the gross margin, we ended last year at a very strong level at 79.1% and that's broadly in line with the prior year 2024 despite the fact that we had almost or more than actually 2 percentage points of headwind from commodity prices, the tariffs in the U.S. and foreign exchange.

So we are quite pleased with that level, and it is reflecting the structural strength of our business model, including the continued efficiencies that we are generating at our crafting facilities in Thailand, as well as the benefit that we have from the price increases that we implemented during 2025. As we continue to invest in the brand and in growth this year and in the future years, our EBIT margin ended at 23.9% last year. That was exactly in line with the guidance that we have set out for the year, but around 1% lower than 2024, reflecting these external headwinds that we already mentioned, the U.S. tariffs and silver prices, not the least.

Lastly, I just wanted to highlight the cash conversion that you can see roughly in the middle of the table, a solid 65% cash conversion in 2025 and within that range of 65% to 70% that we announced at the Capital Market Day in London back in 2023. So again, the overall message on this slide is that despite increased external headwinds, our financial model remained robust in 2025 with strong margins, solid profitability and attractive returns.

Now if we look a bit forward and see how the increase in silver prices and the transition to platinum plated jewelry will impact our EBIT margin in the years to come. So a lot of text and illustrations on this slide. But what we are experiencing today is an exceptional turbulent external environment driven not least by the significant commodity headwinds that we are seeing. As Berta mentioned, we are introducing platinum plated jewelry, which will be a great help in offsetting these headwinds from 2027 next year and onwards. This transition to platinum-plated jewelry will reduce our exposure to commodity prices over time.

Our exposure to silver specifically will decline significantly, while the new platinum exposure will be far more limited. And even though the platinum plated jewelry will require more craftsmanship, so more labor cost, then labor cost is a more stable and predictable cost than commodities. Overall, with this transition, we will remain a structural high-margin company. And as you can see on the bridge here to the far right, we will expect to get to more than 21% EBIT margin in the midterm once the transition to platinum plated has been completed, and this is based on a silver price of $82 and that also means that our strong free cash flow generation remains intact and there are no changes to our financial model.

Now a few comments to the bridge on the slide. The starting point on the bridge to the left is the guidance for year 2026 of 21% to 22%. In 2027, next year, we will have a significant headwind from the higher silver -- but based on the transition of roughly half of the targeted silver-based assortment into platinum plated, that gives us enough margin uplift next year to keep the EBIT margin in 2027 above 14% at a silver price of $82. And this is before some one-off transition cost. And that above 14% EBIT margin, that's what you -- the black bar that you have just to the left of the middle in the bridge.

The transition cost, that includes that we will see some deleverage at our crafting site in Thailand because we are initially partly using external crafting capacity OEMs as it's called, to some extent, extent, and there will also be certain remelt cost as one-off cost next year. So including those transition costs, the EBIT margin next year will be at least 12%. And that's the black bar that you can see in the middle here. As we then transition the remaining targeted silver assortment into platinum plated and as we optimize our crafting, we will get to at least 21% EBIT margin in the midterm. This transition also requires approximately DKK 600 million in one-off investments to rebuild our crafting facilities. And of that, DKK 300 million to DKK 500 million will be invested already this year in 2026.

And with that, I'll hand it back to Pernille.

Thank you, Anders, and thank you also, Peter and Berta for the overview of Pandora's activities in 2025. As mentioned in the introduction, we will deal with items 1 and 2 on the agenda together. So I will now move to Item 2 concerning adoption of the 2025 annual report.

On the screen here, you will see excerpt from the independent auditor's report, and I have been presented with Pandora's annual report signed by Pandora's executive management, the Board and Pandora's auditor, EY. And in the independent auditor's report, EY states the following. In our opinion, the consolidated financial statements and the parent company financial statements give a true and fair view of the financial position of the group and the parent company as at 31st December 2025 and of the results from the group's and the parent company's operations and cash flows for the financial year 1st of January to 31st of December 2025 in accordance with IFRS accounting standards as adopted by the EU and additional requirements of the Danish Financial Statements Act.

At this point, I would like to hear if there are any comments or questions to the report on Pandora's activities during '25 and the annual report for '25. And I have already received a notification from two shareholder representatives.

So firstly, I will invite Claus Wiinblad from ATP to say a few words.

Thank you for the floor. My name is Claus Wiinblad, and I represent ATP. First of all, thank you to the Chairman, CEO and CFO for their report and presentation of the results for 2005. 2005 has been a tough year for Pandora with introduction of tariffs, muted consumer sentiment and silver price that has -- which has gone through the roof.

Looking at the actual result for '25, the EBIT margin is actually holding up really well, among other things, helped by the hedging of the silver price. But the slowdown in the like-for-like sales growth is a concern. The concern consists of two elements. Firstly, well the sales of the moments platform have peaked and therefore, the risk of decline. And secondly, well the fuel for more can grow fast enough to drive an overall improvement in the like-for-like sales performance.

There are many moving parts during '25, which has affected Pandora both in the short term and also in the long term. Pandora has communicated very well about all these moving parts, silver, tariff, et cetera, which has been really appreciated as we heard in the presentation from the CFO. Pandora has really done an excellent job in creating the best possible transparency around all the challenges. That being said, it has also been a rough year for us as shareholders. During '25, the share price dropped by 46%. And from the peak, the share price has dropped by more than 60%.

I would also like to ask a question regarding the launch of Evershine, the upcoming platinum-plated product. The product, as we heard, has been widely tested in major markets. But what's the experience with these kind of tests and how a good prediction are they actually of whether the consumer will eventually buy the product when it's launched. Secondly, what are the expectations for Evershine? Is launch primarily going to help protect the margin from the high silver price? Or does Pandora actually see a potential for Evershine to be a driver for improving the like-for-like sales growth in the medium term?

I would also like to comment on the remuneration report. We are voting against the report due to the extraordinary award in '25 to the CFO. In principle, we opposed these types of extraordinary awards and find that it's an interim, which should only be used in very special circumstances. It's not that we don't appreciate the management team's performance, but our opinion is that it is well covered within the ordinary remuneration scheme.

Lastly, I would also like to thank Alexander Lacik for his great effort as CEO of Pandora and to extend a warm welcome to Berta De Pablos-Barbier as our new CEO. With those words, I would like to wish management and employees best of luck in their work and with the challenges ahead in '26. Thank you for the...

Okay. Thank you, Claus Wiinblad, for your comments and inputs and questions. I'll try to answer a couple of the questions, and then I will hand over to Berta to answer, especially around our expectation around Evershine.

You said you had concern about whether we are able to grow moments going forward. And we are not that concerned. We will be able to grow moments, and we see very healthy signs of that. Regarding fuel with more, you also had the question is will that really create growth for us? What we see is that we have probably in the last year or years, we have done a little bit too much on too many areas. We see that when we really focus our resources, we create growth in fuel with more. And I think the Talisman is one very good example that was very successful.

Then I will just give a short comment also on the remuneration report. As I mentioned, it is not approved. It's only for advisory vote, but it's not approved by the AGM. And -- but that being said, we -- as a Board and the Remuneration Committee, we do what we think is right for the company at the moment when we take decisions like, for instance, an extraordinary bonus. I would also like to underline that this is according to our remuneration policy that was approved at the AGM last year and the year before. So it is according to the policy, but I fully agree that this is something that should be exceptional and nothing that should happen every year. But I also have to say that I think we have been through some quite exceptional years, the last -- I would actually say, since COVID and maybe especially the last year.

So with that, I will hand back -- hand over to Berta to give some comments on Evershine.

Okay. So let me start by explaining a little bit how the journey started with the platinum plated proposition to the consumer. When we take decisions like this, we first start by answering the first question, which is what is Pandora for our consumers? And that's how this journey has started.

What we know is that the consumers that buy Pandora, they buy mainly for three things. They want well-designed pieces that are great quality and is allowing them to express who they are, how they feel, what they want to remember, who they are. Whenever we talk with consumers, the metal didn't come as the first driver of purchase. Today, our consumers buy white metal products and yellow metal products. The yellow metal products that they are buying today are plated already. The business of our gold plated products, so yellow metal plated product has been increasing year-over-year, which is signaling to us that the consumers are already willing to accept platinum plated products.

Once we came to this conclusion, the second thing that we did is understanding about, okay, let's ask again, is silver really, really important or not for consumers. And we found that for the big majority, the fact that is silver, in some cases, it was unknown. And in other cases, it was the white metal proposition that we have for them. Next stage, therefore was to look into what was the best white metal proposition that we could offer to our consumers and continue to deliver well-designed pieces, high crafted quality with meaning for them.

And through that, we went through a big offering of other white metals out there. I'm not going to bore you with the science, but we could have done rhodium, palladium, titanium, et cetera. And what it came very apparent to our consumers is that they wanted a metal they could recognize. That was the case with platinum that they considered precious. And today, 80% of our consumers told us platinum is a precious material. And last but not least, a metal that they were associated already with the use of jewelry, not cars or electronic components.

So then platinum plate became the obvious choice for this proposition. But then we didn't stop there. We went to ask our consumers, okay, what is it that you like about platinum? The only thing that our consumers knew about platinum is that it was a precious metal, and that was enough. But what we are telling consumers, and I'm going to tell you into the test facing, we tested about what are the benefits about bringing platinum plated in addition to the preciousness, which was already a good driver.

One of our biggest barriers and complaints that we have from our consumers is that silver tarnish. So they buy a beautiful, shiny product. And if they are not aware and our younger consumers, they are getting less and less aware about you need to polish your silver, they get frustrated with their white metal becoming not white after some usage. The beauty of platinum is what I was saying before is that it's good for tarnishing. They can wear it to the shower, to the beach and it's very resistant because platinum is a very hard metal and therefore, it's resistant to scratching, okay?

So all that then cover what we like to call when we launch an innovation, the desirability phase is the product that we are going to be bringing to the market desirable to our consumers. All these phasing, it was tested every single time for consumers. So we are not only talking about one testing, we are talking about multiple testing in the last 12 months. The last one that we did was a quantitative testing that was about 25,000 to 28,000 consumers across the world in different markets. It was quantitative and allow actual consumers to really choose and put them in what we call a shopping environment to see are they going to actually purchase that product. So it was online, but they were in real situation of purchasing our products.

Now of course, we are not stopping here. This year, we are not launching the or transforming the collection from silver to platinum. This is, as you know, it's going to happen from 2027. But this year already, we are introducing and learning real life about putting in front in our stores, real platinum plated products in front of the consumer. And then it's going to help us to understand what ticks, what needs to be polished, what needs to be tricked so that the product is really the best presented to our consumers. So we still will be learning this year, but we have enough evidence already that we are in safe thing. This is on the desirability part.

Of course, the next thing that we look is that is the product viable. And I think Anders explained that very well. I'm not going to get into that. And the last thing is it feasible on our lines. And it was very good for platinum plate, and that's why the financial is good is that we can continue to produce the platinum plate products into our Thailand and Vietnam production sites.

Now what we call Evershine, just to be very clear, is the core. So it's this signature metal alloy. That metal alloy was not something that has been invented in the last 12 months. It's a metal alloy that we've been using since 2008 when we first launched the rose plate. Then it was tweaked when we launched our yellow plate. And then what the teams in Thailand needed to do is work with the best suppliers on composing different alloys to see how this alloy was going to be optimized so that it was perfectly prepared for the process of plating with platinum, which is slightly different to gold. We're not get into all the detail. Happy to discuss all that for ages, but it's just a different -- slightly different. So they've been perfecting both the alloy and the electroplating processes to make sure that we get the quality and the durability of that. The reason why we are calling Evershine is just to signal that it's something that is own to Pandora. But for the moment, what we know, again, let's see what happened in the stores is that what really consumers care is that it's platinum plated.

Thank you, Peter and ATP for the questions. I will now invite [ Carsten Christiansen ] from Danske...

[Interpreted] Thank you very much for the floor. My name is [ Carsten Christiansen ], and I represent the Danish Shareholders' Association, and I'm myself a shareholder in Pandora.

First of all, I would like to thank the Chairman of the Board and also thank Berta and Anders for their reports of the annual report and annual finances. I would also like to give a warm welcome to our new CEO, Berta. And I hope that you, as a CEO, will also prioritize keeping our small shareholders well informed about developments in Pandora. Now the development in sales. When I look at the sales development in Pandora, there's been growth in the past 5 years. But unfortunately, the rate of growth has been declining, both for organic growth and LFL.

For 2026, the outlook is unfortunately negative growth of down to minus 3% for like-for-like and the outlook for organic growth is not very high either. So could the Chair maybe say a bit about the targets for sales growth in the medium term? Now sustainability and recycling. I would like to commend Pandora for the efforts in sustainability and recycling of materials. It's great to see Pandora work with renewable energy sources, lab-grown diamonds and not least recycling of precious metals such as gold and not least silver.

Silver is not just used for jewelry, but also for cutlery, candle sticks holders, and it's also an industrial metal used in both data centers, batteries in e-vehicles and solar panels. According to the Canadian company, First Majestic Silver Mining, there's an annual consumption of silver of 1.150 million ounces, but extraction from silver mines is only 835 million ounces. That means there's a deficit of 315 million ounces that need to be covered in a different way. Therefore, it's important that Pandora works to recycle precious metals such as silver. So when there's a greater demand than supply, we know it means rising prices.

Over the past year, we have seen a rising silver price, which has put negative pressure on Pandora's share price, probably rightly so. On Page 133 in the annual report, it's described which effect the increasing silver price will have on the EBIT and the EBIT margin. Therefore, I would also like for the Chair to say something about which opportunities Pandora has to reduce the negative effect further. I mean the negative effect of rising silver prices on the EBIT margin. To what extent will it be possible to maybe pass on the increasing prices and precious metals on the consumer without it causing to negative effect on sales. With these comments and questions, I would also like to thank for the floor.

Okay. Thank you for your questions and inputs. First, I'd like to comment on the -- on your question regarding the long-term sales growth objectives for the company. As we have previously mentioned, for 2026, we are targeting organic growth of minus 1% to plus 2% and that reflects like-for-like growth of minus 3% to 0%, and that's supported approximately by 2% contribution from network expansion. And this is driven by two main factors. I think we've been through this also earlier today.

First, we do not currently expect meaningful support from the macroeconomic environment as consumer demand remains quite uncertain. Second, we see the need to step up execution in several key areas as discussed earlier today. I think we said this several times, Berta also mentioned it that we are not happy with that development going forward, but that's the guidance we have for 2026. If you look beyond the current transition period, we continue to expect that we will return to positive growth, both organic and like-for-like. And we will rework in due time on specific medium-term targets as our current medium-term target runs out in 2026. So we'll come back to this.

But I think my main message is we are not happy with the guidance we are showing for 2026, and we are taking actions, as Berta has mentioned, to course correct so that we get back to growth again. Then it was about the silver prices.

I think we have also covered that, but that is obviously a very big challenge for us. Silver prices has increased from when we had our last Capital Markets Day, and we announced our long-term targets.

Silver prices has increased from at that time, $25, $28 to yesterday, it was $88, and it's even was as high as $120 weeks ago. And now it's around $80, $90. So that is obviously a big challenge. And that is also why we do this transition to Ever Schein. And as Berta explained, we have started it. We are testing. We have been testing this with quite a lot of consumers. And we will launch the first products to be -- to show to consumers already end of this year, but the transition will really start '27 and onwards.

But we are sure that we will be able to reduce our dependency on silver and other commodities substantially by doing this. And at the same time, we'll actually be able to offer the consumer with a better product than silver due to the reasons Berta mentioned regarding [indiscernible] water resistance and so on. But that being said, I think silver will still be an important part of our assortment. We will -- and we have also increased prices. We did that during 2025, and we will continue to do that also this year. But we also have to remember that we're the start of Pandora and it's about being affordable for people that is important. So there is a limit to how much we can increase prices without compromising our promise to our consumers. So we'll do a gradual selection and reduce our dependency. So I think that's the answer to the 2 questions.

Any other comments or questions from shareholders?

Thank you. My name is Stefan Goyan, and I will speak Danish as we are in our capital of Copenhagen and in the main office of Pandora. But I would also like to say a great thank you to Berta for a very good report and thank her for speaking English so well and so calmly.

So those of us that are not 100% comfortable with English were able to follow along. I understood almost everything. There are, of course, always words you don't understand, but thank you for speaking so slowly and intelligently. And also to Anders, thank you for a very good financial report. Anders has actually been called one of the best CFOs in Copenhagen by analysts.

But I still think it's interesting what ATP mentioned, and they expressed it very clearly by not wanting to vote for the remuneration report, which we should actually also have seen on the screen. So I think we still need to know what is it about this extraordinary bonus of 2025, which has maybe already been paid out. I don't know whether that's already been paid out, this incentive. Because executive management in the companies in Copenhagen, about DKK 20-plus million plus all sorts of benefits and incentive schemes.

One of the persons that make the most is the CEO of TORM, and he's selling some shares now, which means he makes DKK 100 million because they get so many shares as part of the incentive schemes every year. And in recent years, I think it's been -- it's become too much certainly in the shipowner TORM, but also in other companies. But it's as if nobody cares what shareholders think about this. For instance, Carlsberg CEO they pay him based on what the international brewery owner gets. And then in London, they get DKK 50 million. So the CEO of Carlsberg also gets DKK 50 million, DKK 60 million in just a base fee, which is ridiculous considering what people earn in Copenhagen, where it's DKK 15 million to DKK 28 million for CEOs and a bit lower for CFOs.

But that's something Carlsberg has decided -- and there -- that's the foundation, the Carlsberg Foundation, and they're the majority shareholder. So you can't do anything about it and just shows how ridiculous some of these levels are. I don't think you paid too much in Pandora, but I just want to ask about incentive schemes and share buybacks, share options for the executive and 40 employees. Previously, it was just the 3 top managers, and now it's almost 50 people. I mean it's just gotten too much in recent years, I think. So I'd like to hear a few more details.

And about your new annual report, it has a front and a back and it's already fallen apart. So that's the front page and you get the back page and they already come apart in my hands. I mean this is just for [indiscernible]. I mean, you need an annual report that stays together in A4 size, not half of it. And then it has to be like reading a book. And then it's -- then you can go to your cottage in the weekend and read all your annual reports.

That's what I do. This -- I mean it's like buying a car in this. I mean it's worth, especially with this spiral setup. You should change that because when you're a professional company, you should be professional in everything. I mean this as an annual report, as for amateurs, lots of pictures and numbers now, they take up half of A4 because it has to be so narrow.

And I mean, you are an extremely capable company, but this is not good. An annual report, A4 format. I mean, I respect the environment. I mean it's just halved. I mean, next year, how can you make it even smaller next year? I regret to think. I mean this is laughable. Now how to distribute what has been earned, the profit allocation. There's a very high share buyback program. This was developed in Wall Street by scrupulous stock brokers and huge American stock brokers like Goldman Sachs, JPMorgan, et cetera, et cetera.

They came up with all this share buyback, and they love it in the U.S. Yesterday, I read that Salesforce, one of the largest IT companies, they take out debt to do share buybacks. We shouldn't be that crazy in Copenhagen. We shouldn't emulate what Americans do. What's happened this year? I mean trump is now in the White House. We know about that. We hear about it every day. We shouldn't emulate Americans. They're not our friends anymore.

What we thought for 50 years that they were our friends, it influences Novo Nordisk, it influences Danish industry exporting to the U.S., the reputation of the U.S. is influenced, it influences us because it's the largest market for Pandora. The U.S. is the largest individual country for us, and we shouldn't emulate what those stock brokers do in Wall Street. Our share price has gone from over DKK 1,300 in December 2024 to DKK 760. So it's gone down 46.6%. Pandora announced we'll buy back DKK 4 billion share buyback, but it was DKK 4.6 billion in 2025. So we've burned a lot of money now.

There was a very high share price, and now it's gone down. We've burned about DKK 480 million a month on share buyback. And now we have a share price that's halved. And this year, it's dropped 31.6% to now about DKK 476. So even such a large amount as DKK 4.6 billion has no stabilizing effect on the share price, none. It's just meant that the share price has gone down and down and down. It's a trend. The silver prices have gone up and Pandora has gone down. And it's not fair because Pandora hedged most of the silver consumption for 2025.

And we were also told in the third -- second quarterly report that you have bought silver at fixed prices and also for 2026, and that's why we only have 11 basis points of the silver prices, even though it's increased by more than 100% in 2025 and continue to increase in 2026. That's because Pandora is very, very good at doing this properly in the finance department. So just like with oil, you can buy futures, and that has been used very capably by Pandora. And I would like Anders to also confirm whether you've hedged the price sometime in the third quarter with the prices that were there last year on the commodity of silver.

But about share buyback? I don't even remember the name of the Chairman of the Board right now. But I mean share buybacks, you should stop. You should really stop. The internal value of the Pandora shares is actually also much lower than the about DKK 500 million or DKK 1,100 or DKK 1,328, which it was in 2024 because Pandora does not spend the profit in consolidating, but spends it on share buyback. And I would like to thank you for the dividends every year, but allocation of profits and also the debt has been increased.

I think it would be better to reduce debt instead of paying out or doing share buybacks. But when you want to pay out to shareholders, you should do it through dividends. And I hope you have now learned that share buybacks doesn't influence the share price. It has no positive effect on your opportunity to spend $500 million on a new factory in Vietnam. You could have paid that in cash if we hadn't had done share buybacks. Now instead, we have debt in the facility. That's not smart management.

And I read about that facility already in November -- in November 2024, I think that you invest $500 million in a brand-new facility in Vietnam. So these are important things I hope you don't just talk about on the Board, but that you also change completely because this year's developments have shown that such large share buyback programs have no effect in the stock market. So I mean, you cannot argue with that.

About Berta's report on our main markets, Europe was the largest market she said. She also said a bit about Spain. I don't remember the details, but we have a very beautiful CEO. Now are you from Spain, by the way? Right. Yes. But Spain, Italy, France and the U.K., they are the largest markets for Pandora historically. I think still are. And Germany is the fourth largest market. And as Europe is the largest market for Pandora, I would like to hear a bit more about how are we doing our other large markets such as France, Italy, the U.K. and Germany.

How are things developing there? Has it been difficult in all the markets? Has it been particularly difficult in some markets than others? What's the development in Europe where we have the largest sales? And we are told that the Chinese are taking over everything. No, we are not being taken over by the Chinese. We produce lots of things in Europe. We have the largest airplane factory, Airbus, our cars we act with the world leading in many areas, saying Europe can't do anything, forget it. That's not true. Europe is a very innovative area and have very, very, very good companies.

And you know that if you, like me, spend 50, 60 hours a week investigating all that. So I would like to hear about what happens in Europe. And maybe there's some progress also for '26, '27 and where things not going so well. And then I would like for it to be confirmed and well, maybe from our CFO. Yes, I would like an answer for our CFO when it comes to financial matters. Has the share buyback program for 2026 been decided? Or will you stop it on my recommendation? Or will you change something?

We, as shareholders, would be happy to get DKK 2 more in dividends a year or if we get dividends 4x a year -- just like share buyback programs are done over a year, we would also like to get main dividends here around the AGM, maybe DKK 40 here and then DKK 25 at the quarterly report. So would that be possible to have dividends paid out more frequently? Alexander Lasig is not here today. I think he isn't here today. Is he?

No. Well, I would still like to thank him, the Swede who got Pandora back on track. He was incredibly good. And he loved to fight for our brand everywhere in the world. And we -- when he told the Editor and Chief of the newspaper, [indiscernible], who didn't understand what a brand is and how you maintain a brand. He explained it to him. He was unusually capable. And I hope our new CEO, Berta, will be just as good because I -- we just want to wish you all the best for the future and a better physical annual report next year.

Just a brief comment that the remuneration report you asked for will be the next item on the agenda will be presented as it always is by Peter. And you had, I noted, 5 questions, and we will, I think, answer them. Maybe Peter, will you do the first and maybe Berta will talk a bit about the European markets. And then Anders, a question for you regarding hedging of the silver price and share buyback.

Yes. Some of the questions were actually for me a little bit unclear. But I think regarding the annual report, it's individual preferences, what you prefer, whether it's A4 or A5 format or whatever. I think most people actually read the report that online, but we take note of that. And of course, it should be -- good quality, I fully agree on that. I think regarding share buyback, but -- and also the question regarding dividend payment several times during the year, I think Anders can come back to that.

But my note is that we have regarding shareholder return, we have some investors that prefer dividend, some investors that prefer share buyback, and we try to find a balance to meet the requirements from all our shareholders. And even though you mentioned that we have bought shares and the share price today is lower, we have also been in the opposite territory some years back in time. And then I think Berta will comment on the market development and Anders on share buyback and dividend.

Good. Thank you for your comments and questions. Let me talk about Europe a little bit about why I chose to talk about Spain on my report. It's not because I am Spanish, it's because in Spain, we have really high market share. We are the leader. We are the #1. And despite that, in 2025, we grew double digit, about 19%. And that has nothing to do with what I was doing and neither with my physical aspect.

The other markets, and I think this is why despite the double-digit growth that was happening in Spain, we are not seeing in other markets. And the other reason why I talk about Italy is because of the mature markets. So Italy, Germany and U.K. being the biggest one, as you rightly mentioned, they were declining. So Italy was at minus 9% Germany minus 5% and the U.K. at minus 4%. So it is, of course, obvious that in order to bring back the growth of Pandora and deliver the like-for-like growth, we do need to address the issues that we have in this market.

Yes. And France, it was negative as well. Now I'm originally from Spain, but I've actually been living in France most of my life. So I know that market very well. I also happen to live in the U.K. and I understand what the situation is in those markets. So let me tell you a little bit of why we are doing about that. One of the things that we are realizing on the mature markets, and I'm going to put France on a separate bucket because it has a different problem, is that in both the U.K., Italy, Spain and Germany, the brand is healthy.

So what do we mean by the brand is healthy. When we say that a brand has high awareness, so people are aware of the brand, not only when you tell them do you know Pandora, now we have that. But also when you ask them, can you please let me know some jewelry brands that you happen to think about, Pandora comes as part of that, what we call the repertoire. So the group of brands that consumers think when they are thinking about buying jewelry brand. So awareness of the strategy about talking about Pandora has been efficient because people know Pandora.

What we also know is the second thing that we ask them is what we call in marketing consideration is that, okay, you know about Pandora. The second thing is that would you consider buying Pandora? And then the answer is, yes, I will consider buying Pandora. So I know Pandora, I like Pandora. So the next question that we ask them is, okay, when was the last time that you came to a Pandora store? And the answer that we get in average is, I don't know 3 years ago, 4 years ago, okay, so you like us, you know us, but you are not coming to visit us. Why?

And the answer in these markets, again, I insist in this market is because I already have your products. I already have my bracelet. I already have the charms. So why should I come back? And the answer we need to give them, and this is when we talk about marketing words like reenergizing our collections is basically bringing newness, bringing new products that are going to make those consumers say, I have a reason now to come back to Pandora because I don't have that product.

And this is exactly the proof point that we did last year with the launch of Talisman. Why do we talk about Talisman? We talk about Talisman a lot because this was an attempt of launch was a successful attempt of launching a new collection that was about charms, it was about necklaces, it was about -- but it was very different from what the consumer of Pandora is known, which is more the playful, white metal, colorful charms and it's working.

Just to give you one data point, in Italy, mature market, the collection performed 7 points higher than it did in the rest of the market. And we have qualitative verbatim from consumers coming to the stores and telling us, finally, you launch something new. So that's why we call reenergizing our collection, and this is going to be the focus from when we start from -- and under my leadership, we are really focusing on that creative part. That's one of the thing.

And the second part is that when you launch something new, the press, the influencers, the creators, the consumer, they see something new. This is something exciting. So what do they do? They talk about it. So this is what we call earned media. So it's not media that you pay on the TV, on the YouTube, it's earned because you have done something exciting.

And I would like to quote Oscar Wilde. He said, one of the worst things about being talked about is not being talked about. So this is the same for any brand. So we need to do things that generate conversation, that generate what is called in the profession earned media so that the consumer is something really exciting in Pandora and they come to our stores.

So that's the situation, okay, in the thing. In France, I won't go long about it. We have a different issue. Everything that I have told you about the brand health is true for Germany, for Italy, for the U.K. and of course, which is Spain, which is delivering. And now the next question is, so why is Spain growing [indiscernible]? Spain has been doing a lot of them talk about. They've been activated that earned media muscle and therefore, the consumer know that Pandora is doing that. There are other measures that we grow like the jewelry perception, the stylist bar, et cetera, et cetera. And all those things are extremely positive in Spain because that marketing model has shifted already in Spain, but has not shifted in other mature markets. Having said that, in the other markets where we have low share, we continue to go to be noticed, Pandora, Pandora, reach, we exist, we are here. So I hope that answered your question.

Stefan, thank you for that. I'll also silver question. You're right that we did hedge quite a lot of silver back in April 2025. Just after the so-called liberation day, the silver prices dropped quite a lot, which means that for this year, we basically have hedged all of our silver production at a silver price of $32. compared to $85 this morning.

So the good thing is that, that buys us a bit of time for the platinum-plated transition that is ahead of us. So then on the other question, what do we do with the cash that we are generating? I've been CFO in different companies for almost 20 years. And in most areas, the feedback that we get from shareholders is pretty uniform, a pretty clear direction on different topics, except what to do with the cash. That's different opinions.

It's probably a little bit like politics, you can argue left or right. There's different opinions. There's no really sort of factual right or wrong. But our capital structure policy is that with the excess cash that we generate every year, and fortunately, we are generating a lot of cash every year that will be returned to you is, first of all, we pay a dividend that increases every year.

So this year, it's DKK 22 per share. Last year, it was DKK 20 per share, so up 10%. And then the remaining excess cash is being paid out as share buybacks. Specifically this year, 2026, we are only paying out a dividend. There's no share buyback program. And that's not because we are changing preferences unfortunately in a way. But we know that with this dip in the EBIT margin that comes next year, then that we know that if we paid out a share buyback already this year, our leverage, our financial gearing would become above our capital structure policy during next year and which we want to avoid.

But when we set the capital structure policy that says an increasing dividend every year, the share buyback on top, we asked investors, shareholders around the world. And so in a way, the capital structure policy that we have and the split between dividend and share buybacks is an average of the opinions from shareholders in this room around the world.

So that's the best way for us to come with a compromise on different opinions on this matter. I would note that I'm just trying to do a little bit of math. Then when the company was IPO-ed, came on the Copenhagen Stock Exchange almost 15 years back, the company was listed with 130 million shares. Now there's only DKK 79 million left. And that's, of course, a consequence of that we have bought back shares basically every year since the IPO.

Had we not done that, and we would still be standing here today with 130 million shares in the company, the share price would not be DKK 500, but DKK 300. So what is that, 40% lower. Then, of course, you would have received more dividend in the meantime, but it's not to say there has been some impact on the share buyback program that we have been running for the last many years, but input duly noted. And when we have a Capital Market Day coming up, then capital structure policy review is part of that exercise, and we will take input from different shareholders as we normally do.

Thank you for your replies, and thank you for going through the major markets, and thank you, Anders. The opinions that are stated about share buyback programs and what to do about the profits every year. You get those opinions at road shows. You go to London, the financial capitals, Frankfurt, New York, et cetera. And then you hear from professional investors.

For instance, the guys in the U.S., Morgan Stanley and all the people I mentioned, you have -- they have conferences like this just for the jewelry business, and they invite Pandora, for instance, JPMorgan, Citigroup, et cetera, these -- the customers of American banks who decide which 6 jewelry brands to buy. And Pandora wants to compete with American companies share buyback programs.

And that's sort of buying into their premise, the American premise. And I say forget about it. I can mention Volvo, one of the best companies in Europe. He has -- they have 45 million in profit after tax, and they pay out DKK 13 per share. They have no debt. They have 63 billion in cash, and they are the largest car producer in Europe. they have a uniquely strong financial position.

And we could have the same situation in Pandora if we just spent maybe 40% or 20% on share buybacks and have no debt or only a suitable debt. Now there's a break in share buyback because our debt is now too high. For many years, Pandora has even spent more than the net profit after tax on share buyback programs by taking out new debt. That doesn't make sense.

I thought you would even understand that, Anders, because as I say, you're one of the most respected CFOs in all of Copenhagen. And there are many CFOs in Copenhagen. So don't just listen to institutional investors and pension funds in the U.S. and Frankfurt and London and in Paris. You also need to listen to your own common sense. And in many Danish companies, we also have common sense. Does it make sense to borrow money to do share buybacks? No. Does it make sense to spend 100% on share buybacks and dividends when we need to build a new facility in Vietnam and also other big investments in brand marketing and new stores every year? Every year, we build more than 200 new stores. It doesn't make sense to have such a large debt of 13.8 billion.

So when in 2027, you maybe [indiscernible] again money to share buyback programs. I would at least say do it 50-50. If you spend 80% of the cash flow and net profit, then at least a maximum of 50-50, 50% cash dividends and 50% in share buybacks. Then you've taken both parties into account. But like Volvo, I would suggest cash dividends. A lot of money has been burned on share buybacks when the share price was high. If you'd waited until today, you could have gotten twice as many shares.

[indiscernible]

As mentioned, my name is [indiscernible] share buyback, that's really been one of my main stays for many years. So thank you very much, Stefan, for bringing this up. It's really one of [indiscernible] What's difficult for us small Shareholders is that we can't always see through the whole things about share buyback. So we risk really getting into trouble here. And the big shareholders, they run the whole price.

In politics, I don't like that the big players get it all and the small players don't get anything. And one of the worst companies when it comes to share buybacks is DSV. It's completely opaque to see through what their share buybacks are all about because they pay out their drivers and then they do share buybacks for their shareholders, but it just means that you're distorting the figures in the accounts when you do things like that.

And you end up with a leverage that -- and I don't know if some of the top management have good share options, then it's great to buy back treasury shares because then the value of their options will increase. And all of these incentive schemes, they will increase in value. And I mentioned this at Novo Nordisk's AGM a few years ago, they bought nominally 20 million in shares, in treasury shares every year. And I said from the rostrum, you can keep doing that. And then the B share capital will be gone in 10 years' time. Then they stopped and then the share price was flat for a number of years because they didn't buy their own treasury shares. So it does have a huge effect.

ROCKWOOL also got into trouble that way. They bought back a lot of shares back in 2007. So they were buying back shares at a share price of more than DKK 2,000. And then a crisis hit and the share price fell to something around DK 600. So of course, with the number of shares that they bought, they had a loss of DKK 140 million. But where could we see that in the accounts? It didn't appear in the accounts because once you buy back treasury shares, you depreciate the value to 0 right away. So you can't see it in the accounts. And you don't show it in the 5-year overview that you have this many shares and you paid this much money for it.

It's hidden from the shareholders. And the shares in ROCKWOOL were used for employee shares and so on. And of course, the employees didn't want to buy the shares at a price of DKK 2,000. Once it fell to DKK 600, then they wanted to buy shares in the company. But the shareholders had to pay a loss of DKK 140 million for that little exercise.

So I think 50-50 is a good suggestion. Don't spend more on share buybacks than you spend on dividends. That should be a general rule. And one more small thing. If you want a Pandora piece of jewelry, perhaps, you could hand in your old gold and then get a good price on that because we all have gold and silver that we have no use for.

So perhaps that could be a way of converting our old, useless silver to something beautiful at Pandora. And I don't know the last time I had a silver spoon that I thought was really ugly, then I handed it in somewhere and converted it to something else. But how about these new products that are platinized? Can you then melt that and recycle it? I think there's a problem because will it have the same value as silver because silver is silver.

But once you start using some sort of mixed product, it's hard to know what the value of it is. Right. So the best thing is that when you do all these good things, you should also show it in a 5-year overview because that gives us, as a shareholder, a good overview of what you've been doing for the last 5 years. How many treasury shares have you been buying at what price? It should all be evident in the accounts. But that's the fault of our government. I hope we will see a change of government now.

Now our Prime Minister, Mette has spent EUR 80 billion on a war in Ukraine. So we need a change of government, and we need a better company act so that we know what we are buying when we are investing.

Thank you for the remarks. I think we have already had comments from Anders regarding share buyback and the 5-year overview, nothing much we can do about that, but there is an overview in the remuneration report, which is the next item on the agenda, as I noted before.

But before we go to that, any other questions from shareholders at this point? Then I kindly remind you that we are actually at agenda item #2 regarding adoption of the annual report for '25. Any further comments in that respect? Otherwise, I will note that the report has been approved by the shareholders.

Okay. Thank you for that. And then we will move to the next agenda item. which, as promised, is the remuneration report and presentation thereof. The remuneration report has been prepared by the Board and has been available on Pandora's website since February 4, and I will invite the Chairman to present the report. Peter, please.

Thank you, Pernille. I think we have commented also around this report several times today. But this report was also reviewed by the independent auditors, Ernst & Young. The auditors, they have not reported on any deficiencies in the report. As I mentioned earlier, the remuneration report has not been approved and the Board and the Remuneration Committee has carefully considered the feedback they have received from shareholders prior to this meeting. Besides this, I want to share a few notes concerning the Board and the executive management remuneration in 2025.

The total fee for the Board increased by 4% in 2025 versus 2024, and that is to ensure that the company's remuneration is in line with general market practice. The total remuneration of executive management in 2025 was down 28% from 2024, primarily due to the reduced variable remuneration as the performance threshold for the short-term incentive plan was not met. So I will now give the word back to Pernille.

Thank you, Peter. As mentioned in the introduction, the remuneration report is subject only to an advisory vote. We have already had a few comments for the report from [ HP ], among others. Are there any further comments for the report at this point? As mentioned by Peter also in his introduction and based on our review of the votes that have been cast through proxies and postal votes, I can conclude that the remuneration report for '25 has not been approved.

This means that the company must in the remuneration report for this year 2026 explain how this voting has been taken into consideration. And with that said, I will move on to the next agenda item, which is proposal on the Board's remuneration for 2026. And the Board has asked me to present this item, and the Board proposes the following remuneration of the Board for 2026 is approved by the meeting.

And that is a fixed base fee of DKK 602,000 changed from DKK 591,660 in last year, corresponding to an increase of 1.8%. And in accordance with the remuneration policy, the Chair will receive 3x the fixed base fee and the Deputy Chair 1.5x the fixed base fee. And the Chair and members of Audit Committee received 0.8x and 0.4x the fixed base fee, respectively.

Also, the Chair and members of the Nomination Committee and Remuneration Committee received 0.5x and 0.25x the fixed base fee, respectively. This is a lot of numbers. They have all been included in the agenda. Further, and in accordance with the remuneration policy, members of the Board received a travel allowance reflected as a percentage of the fixed base fee only when participating in any company-related meetings outside their country of residence.

The fee for continental travel is 6% of the fixed base fee equal to DKK 36,120. and the fee for intercontinental travel is 12% of the fixed base fee equal to DKK 72,240. Are there any questions or comments regarding the remuneration for the Board for 2026? Then I will consider the Board's proposal to be approved by the shareholders. Thank you for that. And we will move on to agenda item #5, proposed distribution of profit. And for this item, I will give the word back to the Chair of the Board.

Thank you. Yes, as part of today's agenda, the Board proposes to shareholders to approve a dividend of DKK 22 per share. And this is around 10% growth versus the dividend paid last year, and that is reflective of Pandora's progressive dividend policy that Anders already mentioned. Pandora has a long-standing track record of strong cash returns to shareholders, including both dividends and share buybacks.

And since the IPO, Pandora has consistently executed share buyback programs, resulting in approximately 41% of shares being repurchased and returned almost DKK 6 billion in cash last year alone. While significant cash distributions remain an important part of Pandora's financial algorithm, the Board proposes a temporarily lower overall distribution compared with prior years, and this reflects a prudent capital allocation approach as Pandora mitigates the impact of higher silver prices and supports the transition toward platinum-plated jewelry. As our plans to mitigate the current headwinds mature, we will revert on this topic in due course. And our capital structure policy, it remains unchanged. So I'll now give the word back to Pernille, please.

Thank you, Peter. Any comments for the proposal regarding distribution of profits in the form of dividend? Then I will note. Thank you that the Board has approved this item also -- sorry, the general meeting. Thank you for that.

Moving on to Item #6, election of members to the Board. According to Pandora's Articles of Association, all Board members are elected by the general meeting and hold office until the next general meeting. As announced in July 2025 Christian Frigast has decided not to seek reelection this year. The Board would like to thank Christian for his many years of long-standing commitment and significant contributions to the Board and has asked me to repeat this here at the meeting.

The remaining 7 of Pandora's existing Board members are up for reelection. You can see them here on the screen and a detailed description of each candidate and information on their other posts are made available in connection with the convening of the meeting. Are there any questions or comments from shareholders to the election of members for the Board? Then I will conclude that the Board has been reelected and congratulations to all of you.

The next item #7 concerns election of auditor. Based on a recommendation from the Audit Committee, the Board has proposed reelection of EY Godkendt Revisionspartnerselskab as the company's financial and sustainability auditor for the financial year 2026. And the Board proposes that EY's tasks include providing a statement on the sustainability reporting in the management report and the annual report as applicable. And I have been informed by the Board and Pandora that the Audit Committee has not been influenced by third parties and has not been subject to any agreement with third parties, which limits the general meeting in election of certain auditors or audit firms.

Any questions or comments for election of auditor? Then I conclude the shareholders have approved the Board's proposal to reelect EY and move on to the next agenda item, resolution on the discharge of liability. Item #8. And just to be clear, this matter only concerns matters that have been disclosed in the annual report or at this general meeting. Any questions or comments regarding discharge of liability?

That does not seem to be the case. I consider then the general meeting to have granted discharge to the Board and to executive management. Thank you. Now I move to Item #9. And as said in the beginning, we have 4 proposals here, all by the Board. There have been no shareholder proposals this year. Item 9.1 concerns a proposal to reduce the company's share capital by a nominal amount of 4 million shares equal to 5.05% of the company's total share capital. And according to practice by the Danish Business Authority, the cancellation of treasury shares after a buyback is compared to a capital reduction by distribution to the shareholders.

So in advance of this meeting, the Board has stated that the treasury shares have been acquired in the period between 30th December '24 and 25th of November '25 for a total amount of DKK 4,061,177,430. Any questions or comments for the proposal to reduce the share capital with the treasury shares? That was not the case, then I consider the Board's proposal adopted by the general meeting. And as a result of this proposal and adoption, we will amend the Articles of Association to reflect the new share capital of DKK 75 million. However, before this implementation, we have to wait for 4 weeks, during which a notice will be made through the Danish Business Authority's IT system. This is a technical procedure, and we will complete it once the period has lapsed.

Next on the agenda, Item 9.2 regarding authorization to the Board to let the company buy back own shares. The proposal is to allow the Board to buy back own shares in the period until March 11, 2031. The limits are that Pandora may acquire own shares up to an aggregate nominal value of 10% of the company's share capital, provided that the holding of treasury shares does not at any time exceed those 10%. And the purchase price paid in connection with acquisition of own shares must not change from the price quoted on the regulated market where the purchase is carried out by more than 10%.

Any questions or comments for this proposal? Then I will consider the general meeting to have approved this also. Thank you for that. Item 9.3 concerns a proposal to amend Article 7.3 of the Articles of Association. The capital region of Denmark will merge with the region of Zealand with effect from 1st of January 2027 and turn into the region of Eastern Denmark. Now why am I telling you this? I am because the wording in Article 7.3 of the Articles of Association where -- stating where physical general meetings must take place need to change due to that merger.

And we propose -- the Board proposes to change Article 7.3 to state that physical general meetings shall be held at the registered office of the company or at another place in the Greater Copenhagen area. The remaining part of Article 7.3 is unchanged. So this is only the geographical reference that we change. And because the Articles of Association, it's the Danish version that is the governing version, I will briefly say in Danish that the new wording of Article 7.3 is proposed to state that [Foreign Language] ...

Any questions or comments for this proposal? Also mere technical issue. I consider this adopted also by the meeting. Thank you for that. And then the final agenda item is 9.4 authorization to me as Chair of the meeting. to be able to register the decisions that you have made here today and make any necessary registrations, I will, of course, only file whatever you have decided and not on my own, make any changes to the Articles of Association. Any questions or comments for this item?

Then I thank you for the authorization to do so. Now the final, any other comments, agenda item. All proposals and items for this meeting have now been dealt with, and I would like to open the floor for any further comments or questions at this point to be addressed here at the general meeting. I will note that it is not possible to present any proposals for adoption at this point, but any further comments are welcome.

For a number of years, I've participated in this AGM, and it's also always very interesting. And I'm sure that many of our other shareholders would also be happy to participate. And therefore, I think you should hold your AGM at Radisson Blu, the hotel so that there is a good parking facilities, and it should be at 4:00 or 5:00 in the afternoon so that it's shareholder friendly. The more shareholders that can get the information that we get on a day-to-day, the better and the more likely it is that more people will buy the share.

Pandora is one of the most underestimated companies in the [indiscernible] 25 index. Even though the share prices fallen by 60%, the company still generates 23% to 24% of its turnover in net turnover net revenue, a very few companies can achieve that and the also the big French and Swiss luxury goods company can't perform that well because so they are dependent on China. In Pandora, we're not very dependent on china and therefore we performed far better than Louis Vuitton and all of the other French and Swiss luxury goods giants. Some of them -- most of them are quite a lot bigger than Pandora, but they can't deliver the same results. They are much more expensive in price earnings. We are much more dependent on Europe and the U.S., whereas they depend on China. Therefore, I think it would be better if we were 500 participants at Radisson Blu at 4:00 or 5:00 o'clock.

And I also think that with 42,000 employees, the size of this company could also justify that you would present us with a nice buffet. I think you have 42,000 employees that you serve lunch to. I think you could serve lunch to your shareholders at one of the good hotels in Copenhagen. Thank you very much.

Thank you for that. Board has informed me they will consider your comments. Thank you. Any further comments at this point? That does not seem to be the case. Then I would like to thank the Board and management of Pandora and all of the participating shareholders also online for a good meeting. I close the formal part of the meeting and invite the Chair to give the final words. Thank you.

Thank you, Pernille. Before I formally close this AGM, I would like to express our big thanks to Christian for his very long period as Chair and his involvement in Pandora. He has been instrumental for Pandora's development over many, many years, and you will be missed, Christian.

Thank you.

And then a big thank you to all of you, shareholders, who attended this meeting today, and thank you for your engagement, your questions, your comments. We appreciate that. It's been a great pleasure to see you all, and I look forward to seeing you again here next year. So the only thing left for me to say is that the meeting is adjourned. So thank you all.

Good morning, everyone, and welcome to the conference call for Pandora's Full Year 2025 Results. I'm Bilal Aziz from the Investor Relations team. I'm joined here by CEO, Berta De Pablos-Barbier; CFO, Anders Boyer; and the rest of the IR team.

As usual, there will be a Q&A session at the end of the call. If you could kindly limit yourself to 2 questions at a time, that would be great. Please pay notice to the disclaimer on Slide 2 and turn to Slide 3. And on that note, I will hand over to Berta.

Thank you, Bilal, and welcome, everyone. Well, we have a lot to cover today. So, I will begin with our fourth quarter performance before outlining how we plan to reignite growth through a recalibration toward desirability-led growth. I will then cover the creative innovation, addressing high silver cost mitigation.

Now, I am sure that most of you are aware that we preannounced in January the quarter 4 results. So, let's quickly see how the final and total results shape up. As a reminder, we ended the year with 2% like-for-like growth and Q4 at 0%. These results were, of course, below our expectation even against a weak macro drop, and we do see clear areas where we can drive better performance.

Now on the positive side, our profitability remained very solid throughout the year, and we ended the year broadly as expected. This reflects our high gross margins where efficiency initiatives and pricing actions helped offset most of the external headwinds. Now when we combine this with very good cost control on OpEx, our EBIT margins ended the year around 24% again, 24% with the vast majority of the pressures we face.

It's worth also remember how quickly the environment has changed. I mean, 12 months seems like a very long time ago now. But this time last year, our guidance assumed no tariffs and a silver price of around $32 per ounce.

Now, let's move into some of the details of the quarter. So next slide, please. By collection, you will see that the Core delivered 1% like-for-like growth in 2025 with quarter 4 ending flat. Talisman, the new collection contributed positively in quarter 4, which was very encouraging to see. Now it remains a relatively small collection, but we are pleased both with its performance and the consumer attention and consumer acquisition it has generated, and we are going to continue to build on that momentum on 2026.

In Fuel with more, like-for-like growth was disappointed at minus 3% in quarter 4. I will touch later on our plans on design and how we intend to reignite growth in both Core and Fuel with more. In short, this is going to be about sharpening where we focus our design efforts, bringing greater creative energy to the Core and more confidence and scale to Fuel with more.

Next slide, please. Now going forward, you also will hear me speak as much about earned media impact as about reach. And this slide actually illustrates why. Over the past year, we have increased our presence at highly relevant cultural moments from major fashion awards to global platforms such as the Met gala, the BAFTAs and the Grammys. This activation have generated high-quality coverage and increased media impact value, helping to build brand desire over time, brand desirability, which is one of the most important drivers of sustained long-term growth for Pandora.

In quarter 4, very specifically, we aired our Christmas campaign. It relied predominantly on traditional media and delivered a modest uplift in traffic. The learning is very clear. Going forward, we need to combine paid reach with earlier and stronger earned media impact that will be enabled through PR integration and very culturally relevant activation. Now all of this must, of course, be anchored in a strong design offering, which I will touch shortly. Let's go on to the next slide, please.

While many of you are already familiar with the regional performance, so I'll just only focus on a few highlights. Let me start with EMEA, our largest region that is predominantly Europe. In quarter 4, EMEA delivered minus 1% like-for-like growth. Performance varied by country. And while some markets performed well, the overall results reinforces the need for the targeted strategic shift that I will outline.

At country level, a few markets are worth calling out. Spain continued to perform very strongly in quarter 4. And this is a clear example of a mature market where sustained brand heat continues to drive customer acquisition, showing that there is no fixed ceiling to grow for Pandora. Italy, by contrast, saw a weakening in performance. Now, while some action delivered very encouraging early signal, the outcomes underlines the need for a more decisive change in how demand is activated in mature markets. I will address this later.

Now, let me move to North America. Like-for-like growth was 2% in quarter 4, which was slowing versus Q3. We discussed in January the macro environment that weighed down on consumer confidence and in-store traffic. That said, brand strength in the U.S. remains very solid. And with only around 2% market share, the long-term growth opportunity remains very significant. Latin America growth was minus 7% in quarter 4. We are implementing a new pricing architecture in January. And so far, we are encouraged by the initial response.

Finally, Asia, we delivered positive growth at 2% like-for-like growth, and Japan continues to perform very well and provides a positive reference point as we shape our future approach in the region. With that context, I'll move on to the next slide, please.

Another area, which I will remain very consistent is the role of our stores in driving desirability and elevating brand perception. We have made strong progress over the few years and the economics of our store network remain highly attractive.

By the end of last year, approximately 800 stores have been converted to the new format. In 2026, we will continue this momentum with the rollout of new digital windows displays across many stores, which are designed to improve visibility and drive traffic. That said, like any strong brand, we will not stand still. We see further opportunities as well to evolve our store layouts, increasing traffic flow and presenting Pandora more clearly as a desirable destination.

With that, I will hand over to Anders to walk you through the quarter 4 metrics before we look ahead to what come next on the strategic shifts. Anders?

Thank you, Berta, and good morning.

Then please turn to Slide 10. Berta has already commented on the revenue metrics. So, I'll rather focus on some of the other metrics on this slide. And the key message from us is that despite the soft top line and the significant external headwinds, then our Core P&L, balance sheet and cash metrics remain healthy. And that demonstrates in many ways, the strength of our business model and agility on the cost base.

In the fourth quarter, our gross margin ended at 78% and thereby it was down 170 basis points versus last year and that's driven by a quite heavy 310 basis points of headwinds from tariffs, foreign exchange and commodity prices. So, this means that we continue to offset quite a decent amount of the headwind through cost efficiencies in our vertically integrated value chain. And then at the same time, our price increases do support the margin as well.

I also just want to touch on the working capital. And as you can see here, we have circled in 2 numbers on the slides. That's including and excluding commodity hedging. And the 4.1% net working capital includes some quite significant unrealized commodity hedging gains. So, to really understand the performance, it's better to look at the KPI, excluding commodity hedging. And here, you can see that working capital is still in negative territory, and we are quite pleased with that. Next slide, please.

Here, we break down revenue growth in the quarter. Berta has already covered the key elements. And as we think the bridge is quite straightforward, we will just move on to the EBIT margin bridge on the next slide.

And the short story here is that the EBIT margin played out in line with our expectations and in line with the guidance. And even though I -- in a way, I don't like saying this, then delivering an EBIT margin, which was only down around 100 basis points, that is quite a good outcome with all of the headwinds that we saw in the quarter. And those headwinds are shown in the light pink bar on the right of the bridge, the 440 basis points of in minus and being able to offset the majority of that speaks to some good discipline across the company and agility following the lower revenue growth in 2025. This doesn't mean that we don't have the ambition to offset all of the headwind, but it will take a bit of time, and we will speak more about that later today.

I would also like to note that the OpEx ratio actually declined on a constant currency basis, both in Q4 and for the full year as well. So, we have been executing on the Silverstone cost program, and it's quite good to see that the savings are coming through to help the bottom line.

And on that note, I'll hand back over to Berta to walk through how to reenergize growth.

Right. So, I mentioned a few weeks back that as the new CEO, my focus is to strengthen brand desirability and to deliver sustainable long-term growth. I've been CEO for just over a month and in the business for over a year as CMO. But I want to give you today my initial thoughts on Pandora.

First, it is very clear to me that Pandora has many untapped growth opportunities. I am incredibly excited of what lies ahead. Our overall goal is to continue to build the most desirable accessible jewelry brand. This is a company built on very strong foundation. We are a category leader. Our brand is healthy, and our collections are solid. When you combine that with a vertically integrated value chain and a wide array of in-house crafting capabilities, you have a clear competitive advantage that allow us for scale, speed, agility and notable cost advantages. All of this together is a recipe for a very attractive business model and good runway for profitable growth.

So the question, of course, is how can we leverage off all these competitive assets to drive profitable growth well into the future. My priorities are to reignite growth and to reduce the commodity exposure to underpin our strong business model. All of this then is strictly while retaining the Pandora DNA and purpose.

Now as I mentioned in January, after several years of outpacing the category and driving solid growth, we are operating in a more complex environment, and that require us to be more demanding in how we generate growth. While the current model works well in low penetration markets, we do need to be sharper when we execute in other markets. And this means that we have to course correct where momentum has softened. So, let's see some of the changes and how they look like in the next slide, please.

Now it's not on this slide, so I'm just going to explain it because this shows how we are evolving Pandora growth engine for the next phase. We will remain centered on recruiting new consumers into the brand, and this has not changed. Now what has changed is our understanding of what drives that recruitment as the brand and our markets mature.

Under Phoenix, we rebuilt a strong foundation for Pandora. We strengthened our Core collection. We restored brand awareness through paid media, and we delivered solid like-for-like growth. That what matter. It matters a lot because it took us to where we are today. Now it's clear that what took us here is not going to take us into the next phase.

As Pandora matures, growth is increasingly driven by desirability rather than reach alone. We are, therefore, sharpening the growth engine across 3 connective things: design, brand and markets.

Let me start by design. Our focus clear is on reenergizing all collections. Our Core need greater distinctiveness, greater uniqueness to reignite desirability, while our smaller and underrepresented collections need more depth, need more products, so they can scale their growth.

On brand, we are evolving from a fundamentally model that it was awareness led with paid reach to cultural relevance with earned media. Earned media will be a Core KPI to drive efficiency. It's not an afterthought. It's a dedication as it increased traffic and demand activation.

On markets, of course, these 2 levers means that we will be moving away from a one-size-fits-all model. We'll be calibrating the growth engine by market and brand maturity. We'll be prioritizing desirability in high penetration markets, while we will continue to invest in reach where penetration still remains low. This is an evolution. This is not a reset. It builds on what has worked and strengthens Pandora growth engine for the next phase of value creation.

Now, I'm going to deep dive into design and brand with proof points that show how this approach is already working. Now you will have to indulge me because this is going to be a little bit of a detailed presentation, but I think it's important into getting the full understanding. Next slide, please.

So let me start with design. So, this slide explains why design focus is such a powerful growth lever for Pandora. If you look at the left side, it shows where we operate today. The first bar is the aesthetics of the market under the $500. And you can see that a large share of our business, and by the way most of our newness is concentrated in a relatively narrow aesthetic space. This is the one that we call playful and is where the majority of our Core with moments works today, but it's also the most mature part of the portfolio.

If you move to the right, the design effort column shows that we have put most of our design focus where the biggest -- where the business is biggest with very similar product repeated over time. In very simple terms, basically, we've been doing more of the same in the same place for the same people.

Now the chart on the right, at the full right shows where growth actually has come from. And you see that actually underrepresented aesthetics on organic on fine, on bold is actually where the growth comes from. So underrepresented aesthetics account for a much smaller share of our newness, yet they are delivering disproportionate share of incremental growth when we actually focus creatively on them.

So the issue, you might think is the number of products, but this is not. The issue is not the number of products, it's how and where we deploy them. Going forward, we will keep the same level of newness, number of devices, if you wish, but we will deploy them differently. The Core aesthetics need greater uniqueness, greater distinctiveness to reignite, to reenergize demand.

Now there is plenty of playfulness and creativity that we can still bring to playful. While the underrepresenting aesthetics need more depth and more products to unlock their growth potential. So, this is not either about entering new aesthetics, it's about doing better where we have already started to play. Essence that was launched 2 years ago and Talisman just last year are very good examples of that. This is how design focus will unlock growth, not by doing more, but by doing the right things in the right places. I mean, after all, all this is simply about keeping the brand desirable and contemporary.

So let me just conclude to land the message here. Pandora will become a more design-led with a clearer collection strategy and a more disciplined product development. We will ensure that design effort is focused where it creates the greatest impact. Newness will be rooted in consumer insight, trend research and commercial analysis, which will allow us to deploy the same level of new products more effectively across the portfolio.

And last, greater creative distinctiveness and better deployed newness will translate into growth by strengthening desirability. It will activate demand, traffic and therefore, will support our like-for-like performance over time. You are going to start seeing the first effects of this towards the end of this year, and the impact will be more visible through 2027.

Now in order to support this shift, this strategy, we are strengthening our ELT. We announced as well that we have a new Chief Product Officer. Philippa Newman will be joining in March and will oversee product end-to-end design, collection management and development. This will strengthen our ability to translate a strategy into execution and to ensure that the creative efforts are placed where it matters the most across the collection. Let's go into next slide, please.

Now, I'm going to deep dive on brand as well. Now of course, with any design, any brand, anything that the brand does only works, you actually notice it. You can have great product designs, but if not one is talking about them, what is the point about the whole thing in the first place. Historically, Pandora has been very strong at driving reach, and we actually built industry-leading awareness. This is hugely important, and this has helped created the healthy brand that we have today. But as the brand matures, awareness alone is no longer the constraint.

We see this very, very clearly from our assessment, and we see that very clearly from our results as well, is that the role of brands now shifts from reach to relevance and from only visibility to being part of the conversation. And this slide shows this clearly again, and I'm illustrating this with the 2 markets I mentioned before, Spain and Italy. Spain and Italy are 2 mature markets of comparable scale, but with very different media models. Spain has been more heavily into activating PR, press and influencers and as a result, has generated earned media and cultural amplification year-after-year.

On the other hand, Italy has historically relied on more traditional paid reach and on traditional TV campaigns, with very little activation of the earned media generating tools. I think the outcome is very telling. Sustained earned media in Spain has driven growth year-after-year through customer acquisition and broader momentum across all collections. We are not sharing actually the same chart as well, but it's important to know that all collections generating growth in Spain, which actually core growing at plus 17% and fill with more at a high 24% in Spain.

In other words, where Pandora is covered by press and influencers, they talk about all the collections. The brand shows up its full jewelry portfolio. It builds momentum and it compounds growth. Importantly, as well is that, we tried this with Italy this year with the launch of the Talisman collection. And that show us well in that market that when distinctive newness is supported by a different media approach, customer acquisition improves. So this also gives us confidence that this is not a market-specific setup is scalable in other markets as well.

So let me finalize this with summarizing the conclusion about what I've been sharing with you on the brand part. We start by distinctiveness, bringing uniqueness things that create the spark. This actually gives people, our consumers something new, something that is truly worth talking about.

We then use earned media that carries the story, press, influencers present Pandora wider jewelry offering, bringing multiple collections, all the products into the conversation. Conversation turns into traffic, demand and revenue. So, this is simply how distinctive designs and earned media together become leading growth drivers. So, in short, we will be moving from saying and showing the same thing to the same people to letting different parts of the brand speak to different consumers in different ways.

Now of course, you will have the question about when and how we are going to be seeing these changes and how and when these changes are going to be translated into business. Listen, we are already moving at pace. And I'm basically going to keep you very closely engaged throughout the year.

In the coming months, of course, we will maximize the impact of our existing collections with earned media, but the full evolution of this interdependent communication model will follow next year. So, 2026 is expected to be a year of transition, and we expect to reap the benefit of these changes in 2027.

Now, this addresses 2 main areas that we'll be addressing to organic growth, and of course, now we go into how we are addressing the commodity pressures we've been facing. So, if we can please move to the next slide.

Now, I'm sure you all have noticed that one of the headwinds facing Pandora is the rising silver prices. So let me address how are we tackling this situation. We are doing this while we are providing, and this is very important, a superior consumer proposition to Pandora customers. And we are doing that in line with our DNA and with our vision. We are introducing a very important innovation that we announced today. We are expanding Pandora offering with platinum-plated jewelry, proven on our unique signature metal alloy that we have trademarked PANDORA EVERSHINE.

Now with this unique metal alloy EVERSHINE, it has been optimized for platinum plating, which is actually delivering certified tarnish and water resistant as well as hypoallergenic and therefore, the product is outperforming silver for everyday wear. We will be providing more details of this innovation and importantly, on the impact of the business, so we can go please on the next slide.

Now with the introduction of platinum-plated jewelry on our signature metal alloy EVERSHINE, Pandora is taking a very decisive step in evolving its product platform and strengthening the long-term resilience of the business.

We will be the first jewelry brand to bring platinum-plated jewelry to the market at scale, combining precious metal aesthetics with superior everyday performance. Why am I saying this? In daily wear, platinum-plated jewelry outperformed silver. It does not tarnish, as I was saying before, it is water resistant and it actually maintains brightness over time, which is actually addressing some of the key quality barriers consumers associate today with all silver jewelry. And these benefits matter a lot, because our jewelry is worn every day.

We've been talking with consumers, and we have conducted a lot of consumer studies and that actually showed that platinum-plated jewelry is actually to perform at par with silver products. But most importantly, platinum itself is cited by consumers as the second most valued precious material after gold. So, while we are doing that, which is very important as well in addition to offering better consumer benefit, this fully preserves Pandora craftsmanship. Pandora design language, and also, the fact that we can continue to use our hand finished technique. So basically, they allow us to continue to deliver the quality in line with our brand DNA.

Now, I'm going to let Andres to go through the financial implications in more detail. But let me tell you that strategically, this evolution is fundamental. As you can imagine, by reducing exposure to silver price volatility and enabling a more predictable cost structure, this is helping to protect our future proof our business model, which is actually reinforcing our ability to deliver meaningful high-quality jewelry at accessible price over the long term. So, this was the main area that I wanted to deep dive with you. And I think now it's a good time to move into guidance for 2026. S,o if you can please put the next slide.

So, what can you expect from us for 2026? We are targeting organic growth of minus 1% to 2%. Now this comprises like-for-like growth of minus 3% to 0% and therefore, a network expansion of 2%. Now the like-for-like growth is clearly lower than what I would have liked to deliver in any given year. But of course, we have a few reasons for that. First, we actually do not expect any support from the macroeconomic backdrop right now. It's an uncertain consumer backdrop.

We also -- we see the need to step change execution in the few areas that I have just spoke about. Now on the EBIT margin, Anders will give you more detail, but we are targeting 21% to 24% this year. You can read it in a different way. Basically, this is about flattish versus 2025 when we're actually excluding the external headwinds that we are facing. Another way to look into this is that we are continuing to invest in our business while we are retaining high margins. Now regarding current trading, so far this year, we are currently around flat like-for-like growth.

With this, I will now hand over to Anders to talk through the details of the guidance.

Thank you. On the organic growth, we have already commented on the overall metrics of the revenue guidance. So, I just want to comment on the first purple building block here, the network expansion. We expect a 2 percentage point contribution to revenue growth in '26. There's no doubt that network expansion is still financially very attractive. But in this year, in 2026, we have decided to redirect more focus and resources towards reaccelerating like-for-like. And we will therefore see a somewhat lower growth contribution from network expansion than last year. Next slide, please.

On the EBIT margin, the key message I want you to take away here is that we expect the margin to be broadly flat when you exclude the significant external headwinds that we are facing. And you can see in the dotted box in the bridge that we will be facing between 250 and 350 basis points of headwinds this year from the combination of commodities, tariffs and foreign exchange. The introduction of platinum-plated jewelry help offset these headwinds from '27 and onwards, but it will have a quite limited P&L impact specifically here this year.

I also just want to update you on 2 of the building blocks in the bridge because they have moved since we last spoke about the '26 EBIT margin back in November. And as a reminder, we said back then that the EBIT margin this year would be around 23% based on a silver price of back then $48.

So first, on the commodities. We previously said that the P&L is at least 75% hedged on silver and gold for 2026. And we can now confirm that we are, in fact, between 90% and 100% hedged, which is good news. And the reasons are partly business and partly technical.

On the business side, we do see continued growth in the share of business from our plated products. And on top of that, we keep shifting to designs that are less silver heavy. And on the more technical side, we have revisited the forecasting assumption on how silver consumption is flowing through from initially buying silver as a raw material and then through production and then through inventories before being sold. And all of this means that the hit from commodity prices is only between 150 and 250 basis points, as you can see in the bridge.

The second bucket I wanted to update you on is the tariffs. And this is a little bit technical as well. Tariffs in the U.S. are paid based on the production cost in Thailand. And as our hedging gains sits in Copenhagen, this means that the production cost in Thailand is based on spot silver prices and not the hedge prices. So, with silver prices increasing significantly since November, the negative impact from tariffs year-over-year is now 150 basis points versus around 60 basis points back in November.

You can also see in the bridge that the net operating leverage is flat 0. And underneath that lies that we do keep investing in reaccelerating like-for-like growth. We will not be compromising on that. And then we offset those costs as well as annual inflation and annual salary increases through cost efficiencies as part of the Silverstone cost program.

Next slide, please. So now let's look a little bit further out and then look at the EBIT margin in 2027 as well as in the midterm as we transition a part of our business to be platinum-plated.

Before talking numbers, I just want to repeat what Berta mentioned earlier on. Platinum plated is, first of all, a great proposition for consumers fully aligned with the Pandora DNA. That is the important starting point. And in that context, the lower production cost is almost just a nice side effect. But what does that then mean for the financials?

First of all, after the transition to platinum-plated, then Pandora's P&L and margin exposure to commodity prices will reduce significantly. And that's because the exposure to silver will decrease far more than the exposure to platinum will increase. With platinum-plated crafting, the lower commodity exposure will be partly offset by higher labor cost as it will require more crafting time to work with platinum and plating. But of course, labor cost is a more stable and predictable element than commodities.

So, a few more high-level comments to help you understand what we are doing from a numbers perspective. In very round numbers, we will reduce the silver exposure by 80% with this transition. The first 30%-ish percent will be done next year, 2027. The next 20 percentage points-ish in 2028 and then the remaining 20% thereafter. The silver exposure, which remain in place is around 20% of the current exposure and is mainly related to the part of the assortment which will remain being crafted in silver.

On the part of the assortment that we convert to platinum plated, the midterm aim for us is to get to a production cost which is in line where we have been operating during the last few years with silver at $30 and below. And thereby, we will be getting to the same gross margin. Initially, the gross margin will be a bit lower and then improve as we scale, learn and optimize. But of course, the gross margin will be much better all the way from the outset than at current silver prices.

While we reduced the silver exposure, we obviously get some platinum exposure going forward, but it's far less than what we used to have on the silver exposure. And again, in very round numbers, you can think of it like this. When we reduce the silver exposure by DKK 5 to DKK 6 or $5 to $6, then the platinum exposure goes up by DKK 1, and that's roughly the equation and how to think about it.

So, this means that with this transition, Pandora will remain a structural high-margin company. And you can see that on the slide here to the far right, where we show that we expect to get to more than 21% EBIT margin in the midterm. And that 21% EBIT margin is based on a silver price of $82 and tied to a margin of above $21, our free cash flow generation will, of course, remain high as well.

So, in essence, this means that there will be no fundamental changes to our business model. And now you will ask about when, what does midterm actually mean? And it will take us a few years to get there, and that's probably as precise as we can be at this point in time. The transition as such of a relevant assortment from silver to platinum-plated will be finalized during 2028. But before we get production scaled, optimized, fine-tuned to the level where we will be hitting the above 21% EBIT margin, we need a little bit more time than 2028. But we will, of course, keep you updated.

Now on '27 specifically, the starting point on how to think about that is the guidance that we've given for this year of 21% to 22%, as you can see to the left in the bridge. And at the current silver and gold prices, we have 11 percentage points of headwind next year as a starter as the hedging runs out.

In 2027, we expect to be able to transition half of the targeted silver-based assortment into platinum-plated. And this gives us enough margin uplift to keep the EBIT margin next year in '27 above 14 at a silver price of $82 before the one-off transition cost. And the transition cost, that includes some deleverage on our own crafting side as we initially use OEMs to some extent, and there will also be some remelt costs and other one-off costs. And including those transition costs -- one-off transition costs, the EBIT margin next year will be at least 12%.

And finally, we would like you to note that there will be around DKK 600 million in one-off capital expenditure that we need to reconfigure our crafting site DKK 300 million, DKK 400 million, DKK 500 million of that is expected to be invested already this year. Next slide, please.

Well, you all know that high cash returns have been a part of the Pandora story for over a decade. And that includes last year as well where we returned almost DKK 6 billion in cash. And since the IPO, we have been running share buyback programs consistently and bought back 41% of the shares. And significant cash distribution will remain an important part of the financial algorithm going forward, but with a temporary lower distribution as we go through the transition to platinum-plated jewelry and mitigate the impact from the higher silver prices.

As we announced yesterday evening, the proposed dividend to be paid in '26 is DKK 22 per share, and that's up 10% year-over-year from DKK 20 last year. And just to repeat this important message, we do not see any fundamental changes to our business model. So, with the transition to platinum-plated, we will remain a high-margin and high cash-generating company with an annual increasing dividend and with excess cash to launch a sizable annual share buyback program. And in other words, that means that once our plans to transition to platinum plated is further progressed, we will resume our share buyback programs.

And with that, I'll hand it back to Berta.

Thanks, Anders. So, thank you all for listening so far. I just want to conclude by highlighting just a couple of things. Like-for-like is definitely not where we want it to be right now and not where I think this brand can deliver. We know why we are in this situation, and we know where to act with decisiveness and speed. We are taking decisive action already to get back on track. We will become a design-led company that uses design to drive desire. Then, we will use our strong marketing muscle across more channels to amplify.

Today, we have announced our latest new innovation, the introduction of platinum-plated jewelry. This is a highly attractive consumer proposition with a gradual rollout starting in 2026. The world keeps changing. The macro remains uncertain, but we are adapting and we are moving quickly. 2026 is shaping to be a transition year for Pandora. But I do want to emphasize that we see no fundamental change to the Pandora business model. We expect midterm EBIT margins to be over 21%, and the business will continue to generate significant free cash flow.

And with that, I think we can open for Q&A.

[Operator Instructions] The first question is from the line of Chiara Battistini from JPMorgan.

I have 2 questions, one on 2026 and then one on the transition to platinum-plated. On the guidance for full year '26 like-for-like between minus 3% and flat. I was wondering, if you could provide us with a bit more color on how you think about that by region and notably your assumption for North America embedded in the minus 3% to flat.

And then on the transition to platinum-plated, I was wondering if you could share a bit more color on how you're thinking about the communication to the consumer as you will approach the launch and the transition, how you're going to -- really the messages that you're going to try to push to the consumer. And how to think also about the pricing these new products versus the traditional silver offer? And actually, just a follow-up on platinum. Are you going to start hedging platinum now or not?

Thank you, Chiara, for those questions. I will not go into too much detail on the performance by region. But yes, I think I'll probably just leave it at that. The -- maybe while I'm speaking on the platinum hedge, we will be hedging that exposure is not going to be very big, but we will hedge that in line with our normal hedging policy for silver and gold.

Thanks, Chiara. And yes, what we'll be communicating to consumers is what is more appealing to them. And what is appealing to them is that we are launching platinum-plated jewelry. Consumers consider today to be a -- platinum to be high quality. We know -- they know it's a precious metal. And something that we will be emphasizing as well is the superiority performance for everyday wear, which is something they truly care about.

The fact that it's tarnish-free, et cetera, everything I just mentioned before. We've done extensive consumer testing, of course, of this product, as you can imagine, and we know that it will be well received. Regarding pricing, what the consumers accept today is that it can be priced as our silver prices are today. So, one by one, basically equivalent.

And just to follow-up on the like-for-like for 2026, I push my luck. Any indication on whether we should be thinking about North America sort of in line with the group level or any reason why to think that the performance should be different?

I think, Chiara, you can assume it will be broadly within that range of 0 to minus 3, it's 1/3 of our business. So, I think that's sensible.

The next question is from Grace Smalley from Morgan Stanley.

The first one, Berta, would just be on the product newness you spoke through. So, it sounds like you're focused on increasing the quality of the newness coming through in order to be more on top of maybe current fashion trends and becoming more relevant whilst keeping the number of SKUs constant. How do you see the opportunity for Pandora to use data insights to -- to more quickly react to fashion trends? And is there a risk that you increase the fashion execution risk of the business that could lead to potentially more fashion misses and increased discounting or how do you think about that? And the second question -- sorry, go ahead.

No, go, go. I was going to answer. I was the first one, but why don't you ask the second question and we can just plan them? Sorry to interrupt. Carry on.

Okay. Then the second one would just be for Anders on margins, just -- so over time, it sounds like you're confident to return to at least 21% EBIT margins in the medium term. Can you just elaborate further on the drivers to get from sort of the 14% adjusted in 2027, more than 21%. Thank you for the helpful slide with the margin bridge, but in particular, that last bucket on the margin bridge where you're calling out crafting optimization and other factors. Any more color you can give on that to just help us see how you rebuild to that 21% would be helpful.

Yes. I'll start with the first question. I think let me step back a little bit. It's very important to say that the fact that you want to be a brand that is on trend, it doesn't mean that we will be chasing trends. And it's a very subtle distinction here.

Pandora is not going to become something that is chasing the latest trend, but that doesn't mean that we can be behind either. So something that Pandora has been very good at, and we will continue to be is very data-driven and consumer insights, and that is not going away. What we are adding, and I talked about in the call about bringing Philippa as the Chief Product Officer, but we are also asking Stephen Fairchild, which has an extensive knowledge of the industry and cultural relevance to be there understanding what is culturally relevant and what is on trend.

So I think this is the move that we are doing. And as you rightly said, this doesn't mean launching more. As I show in this chart, we've been doing a little bit more of the same. I talk about distinctive newness, if there is any doubt about what that can be, it means that when you look about 1 year after the other, you should be able to see that there has been some change in the products that we brought from the previous year. And that is what we've been having been very good in all the collections, and that's what we are looking forward. So, it's about bringing uniqueness that is worth talking about.

And on the other question, Grace, I'm sitting here looking at Slide 24 in the investor presentation as getting from the at least 12% next year to 21%. So those 9 percentage points, if I just briefly comment on that and especially the last one.

The first 2 transition costs, they stop, okay, then we get from above 12% to above 14%. The second -- the next one, the transition of the remaining assortment is pretty straightforward, that's another 4 point-ish uplift on the margin. That's simply doing the rest of what we already do in 2027, converting that from silver to platinum-plated. And then really getting to your question, the last 3 points in the last bucket that sits there, there's 3 bigger elements. One is that, we have been perfecting for years to produce in silver.

Now, we're moving into platinum-plated, and we'll probably be a little bit inefficient in the beginning or we will be, and then we will get smarter and smarter as the days, months and quarters go by. That's one element in it. We will -- when we get out of '27, still be using OEMs to some extent. So, we will get that in-house afterwards at a cheaper cost that sits in that bucket as well. And then within the -- there will also be some continued optimization of what sits in the EVERSHINE core alloy over time that will come and sit in that bucket as well. So it's all something that we have quite some visibility on how it's going to play out.

Okay. And just one follow-up, if I may. On the -- you mentioned how the composition of COGS will shift away from raw materials more towards labor. Is there any way to think about -- I think it's roughly 40% of your COGS in 2025 was related to raw materials and silver was around 30% of that. If you -- as you get more towards that medium-term 21% EBIT margin, how should we think about that composition of COGS and the percentage of that, that you expect to be raw materials versus labor over time?

If -- if okay, Grace, if I focus on answering the question on specifically on the products that we are converting from silver to platinum-plated, then roughly what -- how it's going to work out is that -- on that part of the assortment, then commodities, that's silver then in the past few years have been around 50% of the cost of goods sold and labor have been 1/3, 33%, 34% of the cost of goods sold and then the remaining 15%, 16% is sort of all other stuff.

Then now as of today, silver is at a much higher price. So that 50% on silver commodities goes to 75%. That's roughly how to think about it. So that's our starting point that today when the hedging runs out, silver will be 75% of the COGS on the part of the assortment that we are converting. Now then we get into platinum-plated EVERSHINE, then that 75% being commodities drops to 25%. So, it goes down by 2/3. On the other hand, labor will go -- will be around 50% of the production cost in -- when we get to platinum plated EVERSHINE. So, I hope that makes sense. A lot of numbers here. I'm throwing at you, but I hope you can make sense of it.

The next question is from the line of Mr. Chauvet from Citi.

I have 2 questions. The first one on generally the platinum-plated move. A few questions, if I may. Just to confirm, so silver and platinum-plated products will be sold at the same price in '27 and as long as you sell silver. What is your anticipated mix of revenues if we look far out beyond '27 between silver, gold-plated and platinum-plated relative to 75% silver, 25% gold-plated today? And just so I understand, are you intending to entirely replace the silver offering by platinum-plated in the future? And if Platinum was a superior customer proposition with better economics for Pandora, any reason why it hasn't been done before? Could you perhaps talk about the main disadvantages you see of platinum relative to silver? I understand clearly the appeal and the advantages, but any difficulties that you see?

And secondly, on like-for-like, just a follow-up on Chiara's questions earlier. Given your LFL guidance for the year is minus 3% to flat at the midpoint, it implies some deterioration from current trading, which is flat despite easier comps you're getting from Q2. So, what's driving this maybe more cautious outlook. Are you seeing perhaps signs of broader jewelry consumption fatigue, any brand-specific factor? You talked a little bit about design, Berta, earlier. And should we expect any particular region to be under more pressure than it was in Q4 January?

Okay. So let me start with your 3 questions under question number 1, but I will address them all. So, on platinum-plated, when we'll be introducing in 2026, the first platinum-plated and even in 2027. The intention today is that they are at the same price that silver is today. Having said that, what will happen with our silver portfolio, that's something that we have to monitor carefully because silver price are increasing, and therefore, we cannot ignore that.

The intention is not to replace our entire assortment. We will be keeping some collections on silver. So, silver will continue to be part of our basket of materials. It's just it will not be as dominant as it is today. So today, we envisage that by the time we finish the transition, 25% of our assortment will still remain in silver.

If you go back to the aesthetics slide, you can assume that the sparkling aesthetics and the fine aesthetics will continue to be in silver. Why we haven't done it before? Well, if it was that easy, everybody would have done it as well. We've been working on this new metal alloy development, which started with our gold-plated products in 2011, and we have spent the last 18 months optimizing it and perfecting it so that it is better for platinum-plated. So, this metal alloy EVERSHINE has been something that has been a lot of -- the fruit of a lot of labor and high -- a lot of people working on making that possible. So now it's there. We are maximizing it.

Yes. I run the like-for-like question now basically. Thanks for the question there, Thomas. So yes, factually correct. Obviously, comps get easier through the year. I think just kind of repeating what Berta said, environment is uncertain about the early part of the year. We did obviously flag uncertainty in the Q4 release, particularly around the U.S. Let's see how that evolves through the rest of the year.

And then last, but not least, just repeating what Berta has said as well, a lot of the initiatives, obviously, back end of the year, December into 2027 as well. So, the combination of those factors is what leads us to our initial thought process. Let's see how we do through the rest of the year.

Next up, we have Lars Topholm from Carnegie.

A couple of questions for me also. One is regarding the core of PANDORA EVERSHINE. If I look at your Golden Rose Gold, you have a Core consisting of palladium and copper and then your secret-sauce. Maybe a stupid question, but shifting to more plating, does that mean you suddenly get a relevant palladium exposure for us to consider?

And then a second question, entirely different, but you're talking about a transition period where you use OEM production. And does that imply that you have to make layoffs in the production in Thailand since implicitly those crafting facilities will probably have to do less.

Lars, I can take the first one here on the palladium exposure will go up a bit, but it's actually really tiny. So, from a commodity exposure perspective, it's palladium -- sorry, platinum, sorry, platinum, silver and gold, while the others, copper, palladium are really small.

Yes. And on the second, Lars, let me take that one. I mean, the good thing about this EVERSHINE metal alloy is that it behaves as a metal exactly as silver in terms of the melting point, in terms of the hardness, et cetera, which means that we can continue to use the same crafting techniques that we use with silver, whether that is casting or the way that we set our stones or the way that we apply enamel, et cetera, et cetera.

The plating, of course, indicates that it will be an extra step as we do today with our gold-plated product, that is the plating and the polishing of that platinum. So that is the plan. So, it's more about replacing what we have and increasing, of course, our plating capacities. We are starting already on Vietnam. And as Anders was referring before, this will be a rollout about bringing that more in-house, and it's mainly on the plating.

And just a small related question to that. So the 200 bps headwind during the transition does that illustrate the margin you have to give away to OEM manufacturers? Or does it include other elements as well?

That's a good question, Lars. There's other elements in it as well. There will be -- and that's going hand-in-hand with paying some margin to OEMs. We will also see some -- what's the right word, deleverage on our own crafting sites because we will be for a couple of some quarters producing fewer units on our own crafting site. So that sits in there as well. Then there's a little bit of scrapping of existing machines, a little bit of write-down of -- sorry, remelt of -- as we transition to -- out of silver and into platinum. But the 2 big buckets in the one-off cost transition cost is OEM margin and deleverage on our own crafting setup.

The next question is from the line of Kristian Godiksen from SEB.

A couple of questions from me as well. First of all, wondering what your view is on extraordinary price increases, especially in this market you label as a dynamic pricing environment? That would be the first question. And then the second question would be more on if you've done any or you could give some more flavor into the consumer study you made, both in terms of the differences between the ages in the consumer segment, both in terms of the newness you're contemplating, but also on the introduction of the platinum-plated products. And maybe you could also provide some commentary on the reason why in your brand funnel performance you show on your slide that the most mature segment in terms of age is sliding somewhat.

Yes.

I mean, mature of age, sorry, in terms of the segmentation of your consumers.

Great. Okay.

Yes. And maybe on pricing question, I can start out. We have included a bit of pricing in the guidance, 2% average price increase is included. So nothing extraordinary, if you will. And so how should I frame this? The silver prices and gold prices are going up quite significantly, but the competitive landscape is, as you know, very fragmented. Some players in the accessible during price points are exposed to silver like we are. Some are not at all. And then you have everything in between as well. And that means that we see that -- see and expect that pricing behavior will be very different by country.

We have some markets where we see that the silver exposure is pretty much like ours. We have other markets where we see that many other players have less silver exposure than what we have. So there will be quite some differences between what other jewelry companies out there are thinking reflecting on as of today.

Then, I think we also say that, this shock on commodity prices also means that the industry in itself is changing. We know that we're not the only one looking at using other metals, other materials to produce. And that -- that's what leads us to say this is going to be quite a dynamic pricing environment and where in the guidance, we assume that there will be on average 2 percentage points of average price increase. But I can't rule out that it will end up in a different way, but it's not something that we have included in the guidance, if you like.

Okay. I guess you're mirroring what you said previously on you want to play the back end based on your hedging policy that you're hedged for the full year now for this year. And hence, I guess, you can also do a bit of wait and see on what competitors will do, and I guess we'll follow suit in terms to bring up the margin. Is that correctly understood?

Yes. In a way -- sorry, my language, that would kind of be the lazy answer because the fact that we have been -- it's been good that we have been hedged, then that's in a way as a relevant factor on how we actually react. And when we're sitting in France or sitting in the U.S., we should look at what's the competitive landscape. So, if that gives us opportunities to increase prices, we should do that no matter whether we are hedged as not. But of course, looking at our P&L, it gives us another year of good margins before all the hedging runs out.

But I guess -- sorry for the offset, but I guess you being a market leader in some of the countries, then I guess it would be natural that you would be the one leading such a price increase. I guess, that was -- is that a scenario as well that you would be the leader in implementing price increases?

Of course, that's also in the relevant market, that's also one of the factors playing in how we look at it. Yes.

Let me just take the second question. I think it was on the consumer age. So, I think a couple of things that are important to know about that is that when you look at the age segmentation, what you see is that the tendency is for to increase on the 18 to 24. We pretty much keep stable on the 25 to 40. And where we normally see declines is that the above 40. So that is a general in Pandora.

Now your question was as well by collection. What is interesting is that by collection, we don't see many difference. So, I'm just going to give a couple of points on the new collections that I mentioned before, whether it's on ESSENCE or on Talisman or Minis. We see actually a very similar split on always having a majority of the younger part of the Gen Z, which about 25% of that they come to our collection. The next group is actually the Gen X, and it actually gets after lower when we get into the boomers. So very similar in terms of total Pandora and by the time that we bring newness.

On the platinum-plated, we didn't see major difference on the large consumer studies that we conducted. What we did see is that it was a much higher knowledge about the different precious materials and the difference on the older consumer than on the Gen Z. So we found that the young consumers were more open to accept new materials and new metals and that we thought it was just a good idea, the best everyday wear, they were much more positive about that, but there was no barriers on the others because platinum is a precious metal.

The next question is from the line of Anne-Laure Bismuth from HSBC.

I have 2 questions. The first one is on EVERSHINE. So where the pilots have been conducted for the EVERSHINE? And how will you manage the perception risk around plated versus silver, especially in markets where Pandora trust was built on silver? And the second question is about cost efficiency. So, can you detail some of the biggest of cost efficiencies within the Silverstone program?

The first question is on the pilots. Yes. So, on the pilot, we conducted that in all of our major markets. And there was no -- I mean, the consumer today is very used to gold plated products. So, there is no education needed there. They understand that it is a yellow metal called yellow gold, and they can actually buy more accessible products when they are plated. And now they understand that there is a white metal that is called platinum, which is for them is better than silver, and then we are just plating this product. So that was what actually came into that.

So, actually, it is -- it was actually around nearly 25,000 participants. So, this was quite large. And as I said, it was conducted on different markets. What we also tested, and it is very important is whether that was impacting Pandora brand image, but how was impacting Pandora brand image. And everything was actually giving them much more positive impression about the Pandora brand, because it's contemporary, it's actually taking care about their needs in terms of everyday wear, as I just said, and is bringing a precious material that is highly desirable.

Anne-Laure, on the question on cost efficiencies, there's not one big dominating bucket in the savings that are being delivered. It is spread across. But just to mention a few on store operations and store operations is obviously a big part of our P&L. There we constantly look at how we optimize store -- the roster in the stores or store staffing.

The CapEx that we are spending when we're refurbishing stores, how long time is it closed down, it makes a big difference whether it's how many weeks it's closed down. And then beyond that, beyond the rental and the staffing, then you have all the small cost lines in running stores of electricity, WiFi, cleaning. Then there's been a good run on the point-of-sales material and the visual merchandising, getting those costs down.

One of the single biggest buckets is crafting and supply that also through '25, and also expected going forward have been really doing well, keeping perfecting how we are producing our jewelry. Then, we have reorganized our procurement organization. And that's -- I think it's just around a year back, a little bit less than a year back, but already seeing really good results from that having a much stronger procurement muscle.

Logistics is a decent piece as well where we've been looking at the distribution center footprint that has helped us also with not just reducing the logistic cost as such, but also reducing custom duties. That includes that we have opened up a distribution center in Canada that helps us reduce the custom duties as well. So many -- and it's a long list, but these are some of the areas. So I think important to say, nothing is this where we get into the gray zone of risking top line. This is all sort of tough choices, but the cost elements that are not touching what drives the top line directly.

I have one additional question. So, with gold-plated jewelry, the gold rub off eventually. So what does it look like for platinum-plated, please?

Sensitivity on gold, the gold exposure doesn't change compared to where we are today. So roughly, it's when gold moves $100, it's 5 basis points of exposure or so, yes, that's the rule of thumb you can use.

Yes. But my question was more around the evolution of the product with platinum-plated over the years. So will it change because we know that with gold-plated, yes, the product can evolve. And yes, the gold contain won't be that good. So how will it be for the platinum-plated product?

I don't understand the question, but I'm just going to -- if it's whether the designs are going to evolve with platinum-plated, the way that we are considering this is about some of them will be replacement. So, there will be no change in design. But of course, then we will be bringing more newness with platinum.

If the question was about the durability of the metal, then the great thing about platinum is that it's highly durable. So silver tarnish, whereas platinum doesn't. Silver loses a little bit the brightness, whereas platinum keeps and also keeps the color. And when it age, it age, I can tell your French accents, but it's a little bit with more of a patine. So it's actually a more novel way of aging.

The next question is from the line of Andre Thormann from Danske Bank.

Just 2 for me. First of all, on the platinum-plated. Just to be sure, how flexible is this plan if silver price come back in $20 or $30 per ounce? And maybe also on the share buyback, what milestones is it you need to see on the platinum-plated in order to restart the share buyback program? And then maybe lastly, on the price elasticity, previously, you have said minus 1. Maybe it looks a bit worse now. I mean, can you give an update on where you see price elasticity?

Okay. So let me start by the flexibility and then Anders, you can comment. So, we are not coming back. I mean, the reason why we are doing this is because we believe it's a better proposition for the consumer. And what it's doing is actually making us much less dependent in one commodity. I mean, you all know that being so dependent on only one commodity for any business, no matter which industry you play is high risk. So, this is about reducing the commodity and increasing our basket of materials. Now fundamentally, as we are not changing our crafting techniques that we could put in our facilities one or other metal that is not an impact, but it's more about why we are doing this and what is actually allowing us to do for the business.

And then Andre, I can take the question on the share buyback, and I'll start a little bit in a different place. Our capital structure policy is to have a leverage of between 0.5 turn and 1.5 turns of EBITDA. And with the dividend that we are paying out in '26, if you do a little bit of math with the margin guidance or margin guidance we have given for '27, then you would be able to calculate that we would be slightly above the high end of that leverage range even without the share buyback next year. That's the starting point and that assuming that we land at an EBIT margin of 12%.

So, I think with that, I think it was a prudent approach for us to sort of gain a little bit of time going through this transition. And then as we get further visibility on that the transition to platinum, then we will be reconsidering initiating the share buyback program. So, the trigger point is also simply a part of gaining time getting through this transition where there will be a temporary dip in EBIT, which, of course, drives up leverage.

Could it be ruled out that we would do a share buyback program where we will be a little bit above the capital structure policy for some time? I guess, as long as that's sort of a clear path towards getting down towards into the leverage range. I guess that's not a stupid idea. But as of today, February 5, we think it's a little bit too early to do it.

And with this, we've come to the last question from the line of Anthony Charchafji from BNP Paribas.

This is Anthony Charchafji from BNP Paribas. Just 2 questions. The first one is very simple. It's just asking if we are going a bit more towards, I would say, luxury positioning rather than mass market. And my second question is on the project pipeline this year. So if there is any newness this year in the Core or the Fuel and also how to think about working capital and inventories in the next 2 years of transition?

Let me start. No, there is no intention of changing the positioning of Pandora. Pandora is a desirable jewelry brand, is delivered as a desirable jewelry brand and will continue to be so. If we were moving to luxury, we might not have gone to all this hassle of changing silver because we could simply have maybe increased prices. So this is actually a move of delivering a very good consumer proposition, but actually keeping the accessible prices. So I think that is important. That is very clear.

The second question was on newness on Core and Fuel with more. So let me explain a little bit how we operate at Pandora. It normally takes around 18 months from the first sketches from our creative team until we see the product in the store. So we have new team. Philippa is starting. So it's going to take us some time to shake and change and reset some of the designs that we have, specifically on our Core. We started already with some distinctiveness newness on ESSENCE and on Talisman and on Minis. So you should expect to see more of those because it was something that we started last year. And what you should expect to see more of is that we just started the year with a great collaboration with Bridgeton. We are emphasizing that to draw more attention into the products that we currently have. And of course, where you will start seeing more differences is from 2027. But we are moving with the speed and maybe by quarter 4, we'll have something more as well, but that's the situation today.

And then, Anthony, on the question about inventories, I think the way to think about it is 2 phases. or maybe 3 phases, even there's a phase between now and this summer where we have hedged all the purchases of silver at a low price, just above $30. Then that's Phase 1, so to speak.

Then Phase 2 will be in the second half of this year where we have not hedged at this point in time, the purchasing of silver. The P&L is hedged, but not the purchasing of new raw silver. That will then happen at the spot prices. So there will be a period of time where inventories will be going up because of that.

And then the third phase is that we will start using less silver step by step by step as we convert to platinum. And that's then Phase 3 that eventually will end that inventories haven't modeled that all the way through, but be at the levels where they were historically, maybe even a little bit lower because we have the overall commodity exposure will go down. So we don't need as much of commodity inventories. But for this year, specifically, if we look at it from a calendar year perspective, the cash conversion will be impacted by inventories ending the year higher because we will be sitting with silver on the inventories, as of today, just around $80 per ounce. I hope that helps.

Brilliant. On that note, thank you very much for taking the time. And any questions do follow up with Investor Relations. Thank you.

Good afternoon, everyone, and welcome to this short conference call where we thought it would be helpful to outline some of the key points from the trading statement we just released a few hours ago. This pertains to the Q4 trading period. I have with me today Berta De Pablos-Barbier, Group CEO; and Anders Boyer, Group CFO; as well as the rest of the IR team.

There will be a chance to ask some questions at the end that be great. On that note, I will hand over to Berta.

Good afternoon, everyone, and thank you for joining us today at short notice. Well, you will have seen the trading statement released earlier today. So with Anders, I will briefly cover some key points and also add some context. As CEO, my focus is to continue to strengthen brand desirability and deliver sustainable long-term growth. It is clear to me that Pandora has many untapped growth opportunities. Now the macro environment is challenging, which requires us to sharpen execution and focus in selected areas to strengthen brand desirability. I will come back to you in due course with our plans on that.

Now let's turn to performance. In Q4, our like-for-like was flat, including network expansion and other, organic growth for the quarter was 4%, resulting in full year organic growth of 6%. This was below our guidance of 7%, 8% organic growth for the year.

The EBIT margin is expected to be around 24%, in line with our guidance. The quarter 4 like-for-like reflects a deceleration versus quarter 3, driven by North America. Europe remained broadly stable, although with opportunities to strengthen execution. On North America, after 3 quarters of strong growth, we continue to grow, but a slow to 2% like-for-like growth in quarter 4 and organic growth at 8%, plus 8%.

Now growth was impacted by softer traffic over the holiday period, though we did continue to outperform the overall market on traffic. Now given the short period since the year-end, our data and insight remains, of course, preliminary. However, available indicators suggest that the overall category faced challenges in quarter 4, particularly within the accessible market segment.

Now we, of course, don't know how the consumer will behave through 2026 in North America. But we are confident that our brand is in a very good shape, and we have a solid starting point, and we will talk more about that in February.

Now in Europe, our growth was broadly stable sequentially at minus 1% like-for-like and organic at plus 2%. Now there's quite a few different moving pieces in Europe given the number of markets and the different characteristics between them. But well, the story remains broadly unchanged from prior quarters. So while macro does not help either in Europe, we do see areas where we can strengthen execution.

On that note, I'll now hand over to Anders on profitability.

Thank you, Berta, and good afternoon, everyone. Very briefly on profitability. Then even though the top line ended at a touch below the guidance, our EBIT margin is still expected to land in line with the guidance. We did demonstrate quite good cost discipline in the fourth quarter, in my opinion. And the Silverstone cost program that many of you know about is progressing nicely and the gross margin remained healthy.

So the profitability remains in line with our expectation. Specifically on the Q4 EBIT margin is -- that's expected to land at around 33.5%. And that's despite the significant external headwinds, which we have flagged earlier on and that you're all aware about.

And that's the headwinds from foreign exchange, commodities, tariffs, which totaled around 400 basis points in Q4. So the EBIT margin of 33.5% in Q4 is quite a good outcome considering that the EBIT margin in Q4 of 2024, the year before was around 100 basis points higher only. As already said, this means that the full year EBIT margin will land at around 24% and thereby in line with the expectations we set out in the third quarter announcement.

But for the sake of good order, I just want to stress that these numbers are on -- that we have announced today are still unaudited and therefore, preliminary. And with that, I'll hand it back to Berta for the closing comments.

Yes. Thank you, Anders. So to conclude, so that we can go back to the questions. While our recent performance has come below expectations, the fundamentals of our business remain very strong. The brand is healthy. Our core collections are solid and our vertically integrated supply chain and scale do remain very powerful assets. Now that said, quarter 4 and full year 2025 results came below our standards and commitments.

Now after several years of outpacing the category and driving solid growth, of course, operating in a more complex environment require us to be more demanding in how we generate growth. This means to be sharper on what works and decisive in course correcting where momentum has softened.

Today, of course, this is not a comprehensive update. You will hear more that in a few weeks. However, some priorities are already clear. A key focus for us is to reenergize our collections and strengthen brand relevance. This approach is particularly important in mature markets. Now we are also focused on addressing the impact of high silver prices and are moving at pace on actions across new products and materials to protect margins and improve value creation.

So to close, there remains significant untapped opportunities for Pandora as a desirable, accessible jewelry brand, and we are moving with discipline and rigor to strengthen brand desirability and position Pandora for long-term value creation.

I am really looking forward to sharing more detail with you on our call on February 5. And with that, I'll hand over to Bilal.

Thank you, Berta. We can open up to Q&A. I also want to highlight any questions relating to 2026 top line or EBIT margin, we will not answer right now and get back to in the 5th of February for a comprehensive view. With that, we're happy to open up to Q&A.

[Operator Instructions] Our first question will be from the line of Grace Smalley from Morgan Stanley.

First question would just be on the U.S. weakness. And if you could just elaborate more on what you saw there during the holiday period. So any color on traffic versus ASP and conversion, any detail of breaking that down by region within the U.S.?

And it sounds like, Berta, you believe that this was really more market-driven than necessarily company-specific or execution issues. But again, if you could just dig into that a little bit more on what gives you confidence that, that is the case?

And then my second question would be on Europe where it's very clear you think there are some brand initiatives you can put in place to strengthen the brand's relevance in Europe. And I believe you have started to put some of those in place already in Italy.

I guess, were you surprised that you didn't start to see an improvement in the Italian performance already in Q4 given some of those initiatives and what your initial learnings are from that market so far?

Grace, it's Anders starting out on the first one on North America. As you know, in general, there's quite a lack of data available in this industry. And then combined with the fact that we are -- it's just 9 days into the new year, it is a bit limited what's available. But what led us to say what we announced this morning is a couple of data points.

One of the things that we track is general street traffic. And we do that not just in the U.S. but across all markets. And what we saw across the 10 bigger markets, not just in the U.S., but the 10 bigger markets that we are operating in, it was only on 1 one of those 10 where the general street traffic, so not Pandora numbers were positive in Q4. The 9 others, the general street traffic was negative. So it's not great.

With the data that we have from Shopper Track, that's the one that we are using. Street traffic in the U.S. was negative as well in Q4, and we did a bit better than that as we've done for quite some time and still did that better. So that was -- that's one data point. The other data point we have is simply looking at the OECD's consumer sentiment.

And that took quite a low skive during the back half of 2025. And actually -- and I'm just looking at my colleagues here, I actually believe that U.S. consumer confidence reached the lowest since 1960 in the U.S. in November or December. So there's something happening there. And then I know that there are some credit card data available on the industry.

And I guess you're close to one of them or just announced one of them earlier today for the December numbers. And if you look at that, there is something that looks like that the sort of lower end of the market, the accessible part of the market is actually declining or at best flat.

So it's that sort of combination that has led us to saying that the macro actually did turn for the worst during the last couple of months, 8 weeks of 2025 in North America.

Absolutely. Thank you, Anders. And taking on your second question because I think Anders covered the first one really well. Yes, in Italy, we have started doing certain things, and it's actually the analysis on the Italian market that has uncovered the issues between others that we need to focus on, which is about reinvigorating and reenergizing our collections.

And what we actually see is that we have done it, although it's very early days, but where we did something like, for example, with the launch of Minis and Talisman, this is getting a good robust pipeline that is working in the Italian market, but we need to do more of those across the collections, across all the collections.

So we know that our Moments platform needs a little bit more of reinvigoration. So this is exactly what I was referring to. Progress is there. It takes time. So we continue to monitor that and to follow on that.

Our next question will be from the line of Lars Topholm from Carnegie.

Yes. Just 2 simple questions for me. So given your like-for-like was positive for October, can you comment on the exit rate and maybe give some colors as to the exit rate across regions? That was the first question. The second question is, what has your average pricing been in U.S. in Q4? I'll jump back in the queue afterwards.

Yes. I will take the first one, Lars, then hand over to Anders. But the sort of exit rate for the group, yes, you're right. We said around plus 4% in October. So you can assume flattish to slightly negative in terms of an exit rate from the quarter as well. By region, we won't get into too much specific color. But again, the numbers you see in terms of the quarter end won't be too drastically off the exit rate as well.

And on to the second question, I will hand over to Anders.

Just making sure that -- because I was just about to say just shy of 10%, but it's just about that level, Lars. But I'll double check now I say this and then I'll double check. And if it's not correct, then we'll just get back to you, but just around 10% year-over-year price increase for the full quarter.

But as the quarter went by, we did sort of pass the price increase comp in October of '24. So it was higher in the beginning and lower at the end. But on average, just high single digit, 8%, 9% on average for the quarter up.

And maybe in that context, so it doesn't count as a third question. How was the promotional activity for you and for the whole market as you saw it in Q4?

It's basically been flat year-over-year. I think that's the -- so it remains at a high level, but not worse than last year, so to speak. So there has been no sort of -- even though we see that the general trading environment in November and December was soft. We didn't see crazy -- additional crazy behavior, if I can put it like that, both for ourselves and the market.

Next up is Chris Huang from UBS.

I'll ask 2. The first one on the volumes in Q4. So if I remember correctly, in the Q3 conference call, you were commenting that the volumes in October were pretty much back to flattish, slightly down flattish. But given the price increase you had in Q4, is it fair to say that volumes for globally as a whole was down mid-single digit in the quarter?

And do you think there's anything -- any self-help measures you can do, you can pull out of your pocket to kind of inject that volume momentum back to the brand? And then secondly, on the OpEx control. I think based on the guidance, the expected gross margin, EBIT margin for Q4, it does seem like you have very strong OpEx control.

But I'm just wondering if you can give a little bit more color in terms of the 3 main OpEx lines here. I'm talking about marketing, sales and distribution, admin costs and especially given that like-for-like is generally quite muted. So I'm just trying to understand what was the OpEx lines that were driving this strong OpEx.

Chris, let me -- it's Anders. Let me start out there on units, if you look at the total units that we actually sold and that sits in the P&L for Q4, then unit is flat in Q4. And then that means that the revenue growth of 4% that we delivered in Q4 is consisting of flat units or 0 units and roughly 4% pricing increases.

So that's roughly the dynamic. So sequentially compared to Q3, sort of volumes are better as we had expected, but still sort of only flat overall when we look at the total business. On the OpEx control, fortunately, a year back or so, when silver prices started going up, we institutionalized structured cost program, the Silverstone cost program, as we call it. And now with the top line also has been softer in Q3 and Q4, that comes in quite handy that we have a machine rolling already that can help us sort of push up the hunt for decimals around the company and looking for lower cost.

We have not been compromising marketing spending. I think that's important to state out it's all kind of other things where we have been dialing a bit up on the OpEx discipline as we did that actually a while back when we saw already Q3 being soft.

And then on top of that, of course, there's given like-for-like landed below where we had expected it. The bonus programs are linked very much to like-for-like. That also means there has been some reversal of provisions in Q4, unfortunately. But that's kind of why you have programs like that in place. So that there's some variability in the OpEx lines that helps if you're missing a bit on the top line, then bottom line is protected.

And then I didn't fully get the question on self-help. So maybe I missed something.

More you can do on self-help going forward.

Yes, that's a clear, yes, is the way to put it. We put in place -- go ahead, Christian, it sounds like.

On volume.

Yes. So I just wanted to clarify that volume comment. So Anders, you mentioned that volumes overall total units are flattish in Q4 year-over-year. I guess that includes that 4% network expansion, right? If I look on a like-for-like basis, our volumes down mid-single digits?

Yes, then you basically subtract the 4%. So you absolutely -- you're right in your math, Chris.

Our next question will be from the line of Anthony Charchafji from BNP Paribas.

I have 2. The first one would be on the Fuel with More. So a big part of the story is to diversify Pandora outside charms, and we see that Fuel with More is now underperforming. Maybe that might be also a negative mix impact on it. So it's more to have your view on -- if you still see into next year Fuel with More outgrowing the core category and if you have any plan in terms of newness in this category?

The second question is on the pricing. So actually Europe stabilizing. I think that you've got a bit of pricing in Europe, probably 3% in October. Just wanted to have some feedback on how did it go? And what are the next step in terms of pricing?

I'll take the first one, Anders. So yes, on Fuel with More, you alluded to it, mix is part of it because Timeless grew at 3% and this continued to grow in the year. And if you look at what happened this year is that we innovated mainly on the core, which has a very decent sustained performance with the launch of Talisman Minis and all the activations that we put behind so I come back into what we are doing now is reenergizing all the collections, whether they are in the core to refresh our icons or whether it's about extending and expanding what is fueling more.

Yes. And then on the -- Anthony, on the pricing in EMEA, you're right that we did some price changes back in October. And it looks okay. It's still early days. And the reason I'm saying that is that it becomes -- when you go through these 2 months, 8 weeks or 6, 7 weeks of holiday trading, it becomes a little bit more blurred on -- because there's so much going on, so much promotion going on, but it looks like it was the right decision.

We have not sort of shouted out in general that we have changed pricing. So we do expect to see that step-by-step that the unit uplift becomes better. But so far, we are on track compared to what we set out to do back in October.

On pricing for looking forward, there's 2 stories. One is that the baseline is that think about that we are back to the standard model algorithm of 1% to 2% pricing per year. That's our starting point.

We've done quite a lot on pricing in '24 and '25. And now I think the 1 to 2 points that helps offset annual salaries, inflation that hits the P&L where the jury is still out. That's what the significant increases in silver, gold and tariffs, how that plays out in retail prices in the industry.

That could lead to something beyond the 1% to 2%, but we have not concluded that yet and what exactly that means. But of course, we are hit by higher silver and gold as and when hedging expires.

All the other brands will be that as well, maybe even more so given that our gross margins are relatively higher and thereby the relative hit that we get from higher commodity prices is less than the industry in average.

So something will happen, but exactly how that plays out, we're not ready to talk about yet.

Okay. And just on hedging, I mean, you didn't resume hedging since we last spoke during the Q3 conference call. So still 25% unhedged for '26.

Yes. And I will give it -- you're right, and I will give a slight nuance to that. I'll say we are at least 75% hedged for 2026. But we'll talk a bit more about that on Feb 5, obviously. But given what we have -- so the mix of what we are selling, that's a little bit less silver consumption and a few other more technical elements means that we are a bit more than 75% hedged for 2026.

So there will still be a hit from silver being much higher since we last spoke, but a little bit less than the 25% unhedged would otherwise lead to.

Next up is Daria Nasledysheva from Bank of America.

This is Daria from Bank of America. And I have 2. So the first one would be that the press release mentioned that you will be sharing your thinking on commodity exposure already in February. Will we know your entire plant and metal strategy at the time of full year guidance?

Because I believe before you were mentioning that you were planning to share this with the market a bit later in the year. Is the thinking accelerated around this? So just wondering on the timing of communication and what we will actually know at what point? And my second question is a little bit more on the cost lines.

I think there was another question before. I'm sorry if I missed. Did any of the margin support in Q4 come from marketing? And how are you thinking about the brand revitalization and reenergizing the brand into next year and managing with the marketing versus the rest of the costs?

Thank you, Daria. Nice talking to you. So let me just say, so in February, I will be directionally saying what are we going to be our main areas and levers that we will have for the material strategy. So we will provide more clarity versus what we have said now, and that's what you can expect on February.

I think the next question was on the line so you can take that, but let me just start by saying before we talk numbers that as a brand building, I will not sacrifice marketing investments, and we have continued to invest on the brand this year to keep the strength of the brand. And Anders?

Yes, on marketing, the marketing as a percent of revenue in Q4 was in line with the prior year. So just stressing the point that Berta just made, we're not sacrificing that.

Our next question will be from the line of Martin Brenoe from Nordea.

Maybe just to you, Anders, the first question here would be how you think about the situation that you're in right now and the deterioration that you've seen on a like-for-like basis, whether you are changing your scenario a little bit in terms of the network expansion and general cash conversion -- cash protection, thinking about also payout rates, et cetera, whether you're in a situation now where you need to hold back a little bit to protect yourself?

And then second question would be to Berta about the product innovation. I think looking back at 2025, you have seen Talisman and Minis, but it wasn't maybe the year where we saw the most product launches through the year. So I'm a bit curious whether we should see more gradual all year-round product launches in 2026, if that's how we should view it would be super helpful.

Martin, good and relevant questions on the network expansion. I think the short answer is that it doesn't change the plans. But of course, if we saw just hypothetically like-for-like being at where we saw it in Q4 and which is a combination, which is not a secret of the online business growing and the like-for-like in the physical stores being a little bit below 0, not a surprise.

If that will continue, okay, then we will have to sit down and rethink network but we will continue to be super selective and picky in how we are deciding where and when to open up new stores.

The stores that we have opened up in 2025 are very profitable. It's a really strong investment, like you know the story, but with the payback in a year, it's ROIC accretive, quite ROIC accretive as well. So it's still -- that's the starting point we want to communicate that has no change there.

But on the payout ratio, I think you're probably thinking 2027, with where silver prices are today as a starting point, if we did nothing just sitting on the hands, there would be quite an impact on the EBIT margin and thereby indirectly cash and leverage as well.

So I think the answer lies in -- could there be a temporary consideration to do on cash distribution that links into how fast are we mitigating the impact of silver being in the high 70s. As you know, hedging runs out in a year's time and how fast can we mitigate that.

So that's -- and that as we go through '25 -- sorry, 2026, we will update you on that. And the first update comes in a couple of weeks on Feb 5 on how fast we can move forward on the silver price mitigation.

Yes. And then on your second question, I think somehow in your question, you had the answer, which makes it easier. Yes, we will be gradually. You should expect that we will gradually be bringing more impactful designs and storytelling.

You are absolutely right. In 2025, you named some of the major launches. If I'm really honest with ourselves, I think the main one that we did was Talisman and some collaborations where we did major launches that were properly supported, we performed well, where our designs were just familiar design variation, we are either stagnating or declining.

So yes, you should be seeing more of those, but important to know that everything that we do is based on facts and data. So when we launch something in new collection will be design-driven, but consumer validated. And when we go into new aesthetics, we'll be very selective, and we will do that in a very controlled manner and with discipline.

Our next question will be from the line of Anne-Laure Bismuth from HSBC.

I have 2 questions. The first, I know you have changed the reporting, but can you give a bit more granularity of the performance for the rest of [indiscernible] that slowing down? And also the second question is about the gross margin. Can you give us the gross margin bridge for Q4, the building blocks, please?

It's a little bit earlier on the gross margin bridge, but just to give you one data point, if you sum up the last year, that's now 2 years ago, but Q4 '24, the gross margin was 79.8% and we are delivering around 78% in Q4 of this year. So let's call it, 180 basis points down.

And in that mix, if you combine commodity, FX and tariffs, we are getting to -- I'm just doing the math in my head here, 310 basis points, let's call it, 300 basis points of external headwinds in Q4. And that's pretty -- I think we spoke pretty much about that in the third quarter announcement, but 300 basis points down on -- across those.

So out of the 310 basis points of headwind, we are mitigating what is that 140, so roughly half in the -- and then the rest is bits and pieces, to be honest. It's those 3 that are the big drivers in the quarter.

Yes. And then on rest of Pandora, you're right, we are moving gradually towards the new disclosure, but it was predominantly Spain was super strong as was Portugal. And it was Mexico, which was sequentially slightly weaker in the quarter. You can see that in the Latin America where Mexico is disclosed under the new disclosure as well, but everything else is broadly similar in general. But I can get back to you on that as well.

Our next question will be a follow-up from the line of Lars Topholm.

Yes, I do have one more question. And I know you said you will not comment on 2026 and, of course, fully understand and respect that. But still, you have given a 2026 EBIT margin guidance of 23%. The fact that you don't change that in this announcement, does that implicitly mean it still stands? Or is it just suspended or question mark? That's my question.

That's a good way of asking a question, Lars. We are not guiding for 2026 yet. When we made the guidance or the soft guidance, however you frame it at the third quarter announcement saying around 23% EBIT margin, that was based on a silver price of $48, $48. Now it's basically $30 higher.

And there will be some hit from that on an isolated basis of the higher silver price in 2026, given that we are not fully hedged. But it will be less than what you can just mathematically calculate because the hedging will be a little bit more than the 75%. So net-net, it's still a bit too early.

I would also say that we -- as you can see in the Q4 numbers, the cost machine is also up and running. So there's as always an opportunity to protect the margins through looking at the cost line as well, depending on where the top line is landing.

But net-net, yes, it's too early to guide on 2026. We'll do that on February 5.

We do have Andre Thormann on the line.

I just had one question. Sorry for jumping in so late. But I just wondered about Talisman. I recall that it was a significant contribution to the 4% like-for-like growth in October. So can you talk a bit about how that performed in November and December?

Talisman continued to perform well in Q4. And I think one way you can see that indirectly is in the -- if we -- when we go and when we come out with the full year announcement, you'll see that the Pandora Me is growing quite nicely because Talisman sits as part of the Pandora Me collection, and there's quite nice growth in there, and that's driven by Talisman. So it is a new design aesthetic, an addition to the brand that we are quite happy about.

I'm sorry, I did not understand the question in the beginning. That's why Anders answering as well. Fully agree, and you will be able to see that more. Just an interesting data point as well is that what we are seeing [ is that ] in the mature markets such as Italy, we know that it's actually overperforming, which is again another sign that in markets where there is a little bit of fatigue of some of our other products when we bring some news overperform versus the rest of the market. So as you know, we are talking is helping there as well.

Next up is Alison Lygo from Deutsche Bank.

I just had one, sort of following on from what Grace was asking, I think, at the top of the call. In terms of the U.S., it's clear that the macro backdrop has been really unhelpful. Are we to take from your commentary on footfall that it was all transactions that kind of came in beneath where you were expecting? Or did you see any kind of changes in terms of basket size, items per basket? Just interested in terms of how that weaker U.S. consumer is really translating through into the basket you're seeing?

What we're seeing is actually traffic. Traffic really slowed down. And also important to note that despite that our traffic was lower for Pandora, we actually outperformed the overall market. What we are seeing as well, and we will be reading the same reports that we are is that this is not only unusual for Pandora. What we are seeing is some of our competitors announcing a soft holiday period, and we see as well consumer sentiment being lower on the -- more on the accessible market socioeconomics.

So what we are seeing at the moment is the traffic and no other changes on all the other metrics.

As no one else has lined up for questions. I'll now hand it back to the speakers for any closing remarks.

Thank you very much, everyone, for taking the time today, and we'll be back to you in February. Thank you again.

Good morning, everyone, and welcome to the conference call for Pandora's Q3 2025 Results. I'm Bilal Aziz from the Investor Relations team, and I'm joined here by CEO, Alexander Lacik; CFO, Anders Boyer; and the rest of the IR team. I'm also really happy to have with us today CEO Designate and Current CMO, Berta De Pablos-Barbier.

As usual, there will be a Q&A session at the end of the call. If you could kindly limit yourself to 2 questions at a time, that will be great.

On that point, I will hand over to Alexander on Slide 3.

Thank you, Bilal, and welcome, everyone. Let me start with a few high-level points on our business. So we've been operating with very challenging macroeconomics, actually for a while now. But even in this difficult setting, we continue to execute on our strategy and repeatedly deliver solid organic growth. The strategy centers around investing behind the Pandora brand and bringing more exciting innovations to our consumers. This will help keep us relevant today and will drive value for us well into the future.

Our business model and financial algorithm remains incredibly healthy. You can see that in our gross margin still operating close to 80% despite the macro headwinds. We keep having very healthy margins. We keep generating significant cash flow, and we keep driving healthy EPS growth. These points are also clear when we look at Q3. So now let's have a closer look at the quarter. Next slide, please.

Again, we did a good job in a tough backdrop. We have maintained good discipline on the Phoenix strategy and our overall mission to build a full jewelry brand. We delivered 2% like-for-like growth, which alongside network expansion, drives 6% organic growth. The like-for-like growth has been a bit below our usual run rate over the past few years, obviously not helped by the broader macro and consumer sentiment. But we know what to adjust, and we have a healthy pipeline of growth initiatives.

On profitability, we are impacted by external headwinds from tariffs, foreign exchange rates and commodities. In that light, we are very pleased with the profitability of the group with gross margins, as I mentioned, just around 80%. The underlying performance is even stronger. So our core profitability drivers offset a lot of the external headwinds. Finally, our return on capital remains very high at 43%, something you should generally expect from us. On EPS, we continue to drive good underlying growth. So overall, quite a satisfying quarter.

Now, let's have a look ahead. Can we move to Slide 4, please? On guidance, we've generally left things unchanged, but with a few tweaks. From a topline perspective, our guidance is still for organic growth of 7% to 8%. For the like-for-like guidance, we're now expecting that to be 3% to 4% versus 4% to 5% previously, and there's a few things to highlight there.

First, due to the broader macroeconomic situation, we've changed the like-for-like range slightly, as I mentioned, from 4% to 5% to now to be 3% to 4%. The low end of this range would require a worsening of the macroeconomic situation. We are also mindful that the holiday season can be quite promotional, so we built in some room for that, too.

On network, our new stores are performing a bit better than expected. So we have raised our expectations to a 4% growth contribution as opposed to 3% previously. Therefore, in total, our organic growth guidance of 7% to 8% remains unchanged, albeit, as I mentioned, with a slightly different composition. I'll let Anders talk about some of the specific details here later on.

Finally, that brings me on to current trading. In October, our like-for-like trading has been around 4% and thereby above the Q3 level. So an encouraging start to the quarter. On the EBIT margin guidance, the message is that it's unchanged at around 24%. We have managed to absorb quite frankly, an insane amount of headwind this year, and I'm very pleased that we can still target an EBIT margin in the mid-20s. I actually think that's a fantastic outcome and a true testament to the health of our business model and the agility of our organization.

Can we move to Slide 7, please? Our strategic focus is to attract more consumers to the Pandora brand by broadening our appeal as a full jewelry brand. Our North Star is the Phoenix strategy, and the pillars you can see on this slide. This year, we've started to develop our focus a bit more on the 2 aspects you see on the top of the wheel, brand and design. This is something that will continue into '26 and beyond as well.

That brings me nicely on to the next slide. I already showed this last quarter, but I will highlight it again. It shows how big the growth opportunity is for us beyond wristwear. As a brand, as you know, we come from mainly operating in around 18% of the market, increasingly targeting the other 82% of the market is what makes our growth profile really exciting. You see the main elements of the Phoenix strategy on the previous slide.

We are sharpening some of our execution to attract more consumers to the brand and drive like-for-like growth. Some of you may remember from last year that I mentioned how our focus will naturally shift towards design and brand. This includes really looking to dialing up our innovation pipeline and marketing efforts, something Berta also fully endorses.

The launch of Talisman and Minis subcollections are good examples of how we drive incremental newness that brings excitement to the brand. You will also see us dialing up our relevance on a more local level for the use of some assets that reflect our brand values. And then last, but certainly not least, we see opportunities to optimize our in-store experience. I'll come back to that a little bit later.

Now, let's have a closer look at our marketing. Next slide, please. Here are some examples of what we've been working actively through Q3. That gives you a taste of what's to come in the future. From a marketing standpoint, it's fair to say we've made a big impact already with our Talisman launch. The press and media coverage of the collection has been fantastic, and initial consumer reactions are also very positive.

You will remember how in the previous quarter, we mentioned we would also be looking to dial up our brand heat on a local level. Pandora is and will always be a global brand, but there are clear areas where we think we can be sharper and even more relevant to consumers on a country level. We've started to execute this already in some markets and see good impact. This is something we will continue building on. Before I move to the next slide, I also want to comment that our new Christmas campaign is now live. It's a campaign that is more rooted in Pandora's true DNA, driving meaningful moments, and we are super excited for that. So please keep an eye out for that.

Next slide, please. I mentioned earlier on in the year how we're excited about our creative pipeline. This year, we focused the newness in our charms and carriers' core. It's always important we keep this offering fresh and front and center of our consumer minds. We did that through the introduction of our Talisman and Minis collection. And so far, most of our media efforts have focused on the Talisman.

I mentioned previously that the media coverage of our launch has been very successful, and we've also seen this translate in the actual stores. The Talisman collection has resonated very well with consumers with good initial results in all market -- in more markets. It's still a relatively small collection from a design variation perspective, but the consumer appetite to engage has been incredibly pleasing to watch. This demonstrates how we can continue to drive consumer engagement with our unique combination of innovation, affordability and storytelling. Now it is our job to build on this momentum, something I know Berta will have a sharp focus on going forward.

Next slide, please. Now, innovation doesn't just limit itself to new designs. It stretches all the way from optimizing current designs over crafting methods to new material innovation as well. We are advanced in exploring creative innovation that is anchored in our distinctive DNA as a precious metal jewelry brand in the space of accessible luxury. This innovation will allow us to mitigate a material part of the cost headwind we face from higher commodity prices, in particular on precious metals.

Our consumer research here has been encouraging, very encouraging, in fact. And let me be clear, everything we do is being led from a consumer standpoint. That's the center of gravity for us. Pandora's brand DNA is to provide beautiful, high-quality jewelry that is accessible to the many. I won't be more specific at this point in time for competitive reasons, but of course, we will keep you updated when the time comes. In conclusion, we're excited about the opportunities ahead to keep driving our business model forward.

Next slide, please. Let's now look at our 2 segments, core and Fuel with more. As you know, our strategic aim is to be seen as a full jewelry brand, which essentially entails driving steady growth in the core whilst adding higher growth in Fuel with more. As I mentioned earlier, the newness we have is impacting within the core, which helped support growth here at 1%. The new subcollections we have launched are within the Pandora ME, which delivered quite strong like-for-like growth of 34%. You can see once again, how over the past 3 years, we've been able to drive good, stable growth sequentially in our core, exactly in line with our plans.

Next slide, please. Our Fuel with more segments grew at 2%. That's probably a bit lower than what we would have liked. But as I just mentioned, this year, our creative newness has been more tilted towards the core, so there always will be some small swings. We have good upcoming plans for this segment in next year.

Let's now move on and have a look at the markets. Next slide, please. As always, I'll start with our biggest market, the U.S., which delivered a strong 6% like-for-like growth. This performance is particularly impressive of the tough comps we faced in the U.S. Our brand metrics are very strong here. The response to our new Talisman subcollection has also been very positive. As with all markets, our attention now shifts to the holiday season, and we've started Q4 in our largest markets in a pretty good shape.

Next slide, please. In Europe, our total like-for-like growth across all markets came in roughly flat at minus 1%. We continue to see strong growth in Poland, Spain and Portugal to name a few, where the brand is going from strength to strength. Performance in these markets was somewhat offset through weakness in our 4 European markets that we have historically disclosed separately.

I'll pick out a few specific points. The overall environment remains tough in many European markets, but we will also sharpen our execution in a few of them. The first signs of that can be seen in Italy, where I mentioned that we've leveraged some more local marketing to drive brand heat, and the new subcollections have also seen good consumer interest. We've started to see pickup in traffic now in Italy, which is the first important sign we always look at.

We will also leverage this strategy in some of the other markets. In the U.K., our like-for-like growth remains soft at minus 8%, not helped with the performance of our online platform. We are working on fixing this whilst pushing forward with our brand and product initiatives.

Finally, in Europe, we'll also dial up our affordability proposition a bit better. The launch of Minis is certainly helping with that. But as I mentioned in the past quarter, we are realigning the pricing architecture slightly in some markets. So overall, our European growth remains somewhat mixed, but we have a plan, we're executing on this, and we see first signs of improvement.

Next slide, please. In rest of Pandora, we delivered another good quarter of 6% like-for-like growth. This was helped by some of the markets I mentioned in the previous slide, namely Spain, Canada and Portugal. But moving beyond Europe, Japan continues to do very well and is showing very strong like-for-like growth, as we're beginning to build the brand presence out here.

In Mexico, we saw good improvement due to some of the actions we're taking. This is despite the highly promotional environment in that market. We are confident that our improvement continues into Q4.

Finally, in Australia, we saw continued good like-for-like growth of 4%. We have solid -- we had solid performance through the quarter and are also investing in the brand for the long term here.

Next slide, please. Here, you can see a familiar slide on how we create value from our network. We are broadly on track with our openings this year, targeting around 50 net openings by the year-end. As I mentioned, reflecting the good revenue ramp-up we've seen from the openings from the past 12 months, we've upgraded our organic revenue contribution to be 4% from previously 3%. That should give you a good indication how quickly we do see a revenue pickup in new stores. We have little to no cannibalization from existing stores, as we typically open up in pure white space areas.

Of course, the number of 50 openings might look low this year, but keep in mind that net of the 100 closures in China, the latter do not impact revenue significantly, so we expect the gross openings to also contribute nicely to revenue into next year. As always, you'll see on the top of the slide, the economics of new store openings in Pandora. A fantastic aspect of our business is our highly productive stores, generating very strong shareholder value.

Next slide, please. Finally, before I hand it over to Anders, I just wanted to highlight that we continue to sharpen our in-store execution. Part of this comes from the new store concept, which we now have sitting at close to 700 stores, but we've also decided to enhance the store design and lay out to attract more consumers. This includes enhancing visual merchandising and elevated facades.

We are also accelerating the adoption of a new digital window framework, which 80% of our stores should have already by the end of next year. Whether it's the flagship stores or the new formats, it's pretty clear that we have an exciting opportunity to improve how the full jewelry brand comes to life in our stores.

And on that note, I'll hand it over to Anders for a closer look at our numbers.

Thank you, Alexander, and good morning, everyone. Please turn to Slide 20. Our reported financial performance is impacted by the significant external headwinds from commodity prices, foreign exchange and tariffs. And this obviously distorts the picture when you look at the reported numbers. But if you look at the underlying performance, you will actually see that it remains very strong.

On the gross margin, for example, we had 280 basis points of combined external headwind in the quarter, but the reported gross margin was down only 80 basis points to 79.3%. That means that our actions through pricing and cost efficiencies had a strong positive effect in the quarter. So even despite all of these headwinds, we are on track for a full year gross margin to be only slightly down versus 2024.

I'll talk about the EBIT margin shortly, but the other KPI I'll mention on this slide is earnings per share. The reported EPS is down year-over-year in the quarter. But again, if you adjust for the FX headwinds, then we are driving quite nice EPS growth of 5% in the quarter. I normally don't like to talk about adjusted KPIs. But in a quarter like this, you need to look underneath the reported numbers to understand what actually goes on. And when you do that, you will see that our financial algorithm keeps running well.

Next slide, please. On this slide, we break down the revenue growth in the quarter, and we have commented on most building blocks already. And so I'll just add one comment to like-for-like. Like-for-like growth in the full third quarter was 2%. But as we launched the Talisman and Minis collections towards the end of August and as we continue to evolve execution in the other areas we have talked about today, we have seen like-for-like improve since this summer and then reached 4% in October, as Alexander said.

Next slide, please. I've already mentioned the external headwind that we faced on the gross margin, and those headwinds obviously also feeds into the EBIT margin. But at an even higher level, you can see those headwinds in the dotted box here with a total of 380 basis points of external headwinds. And without these headwinds, the EBIT margin would have been 17.8% in the quarter and up versus last year.

As you can see in the purple boxes on the bridge, these headwinds were partly offset through the effect of network expansion, pricing and cost efficiencies. The EBIT margin in the quarter ended exactly in line with the plan. And as you can see, we, therefore, also keep the guidance for the year unchanged.

And then please go to Slide 24. This slide explains our top line guidance for 2025. And Alexander already spoke about our thinking, so let me just elaborate on a few points. The overall organic growth guidance is unchanged at 7% to 8%, but the composition has changed slightly. We've lowered the like-for-like range to be 3% to 4% versus 4% to 5% before. Since the start of the year, the macroeconomic picture has become more clouded and uncertainty has increased. And we did see softer trading during the third quarter. And this has made the old high end of 5% like-for-like a bit too ambitious based on how we see the world today.

On the low end of the new 3% to 4% range, we have factored in a potential further macro weakening in the fourth quarter and a potential more intense promotional environment during the holiday season. And we think that's prudent given the environment that we see. As you have probably calculated, the new like-for-like range implies a like-for-like growth of around 2% to 4% in the final quarter of this year.

And as we said, we started the fourth quarter with 4% like-for-like in October and thereby in the upper end of the implied range. And finally, on the network growth, as Alexander already mentioned, the new stores we're opening are ramping up faster than expected. So we expect to land closer to a 4% growth contribution for the full year as opposed to 3% previously.

Next slide, please. On the EBIT margin for 2025, our guidance is unchanged, and we still expect to land around 24%, and the building blocks that you see on the slide here are also broadly unchanged. But again, I would like to draw your attention to the 280 basis points of headwinds, which sits in the dotted box in the bridge on this slide. And in that context, we are actually quite pleased with an EBIT margin of around 24% this year.

Next slide, please. Now finally, I just want to give you an update on our latest thinking about the 2026 EBIT margin, given how commodity prices keeps moving. And also here, I want to highlight the total external headwinds since we issued the EBIT margin target back at the Capital Market Day in October 2023, and then now, amount to a total quite significant headwind of 620 basis points. And that's the sum of the headwinds from commodity, foreign exchange and tariffs, as you can see in the dotted box in the bridge.

Given the recent surge in commodity prices since we last reported to you in the second quarter, we see an additional 120 basis points of EBIT margin headwind next year in 2026. And that takes the target to around 23% for next year versus the at least 24% that we spoke about in the last quarter.

Our mitigation efforts are tracking exactly as planned. On pricing, we continue to expect the benefit of around 210 basis points on our cost -- on the cost side. We are moving ahead full speed on the cost program, which we call Project Silverstone, and we are executing as we speak. And at this point in time, we still expect savings equivalent to 50 to 100 basis points margin uplift in 2026.

And then finally, but important, as Alexander mentioned, creative innovation has the potential to mitigate a material part of the EBIT margin headwind when you look beyond 2026 and thereby also has the potential to protect our high margins and protect our strong financial algorithm.

And on that note, I'll hand it back to Alexander.

Thanks, Anders. So to conclude, let me just highlight a couple of things. Our business model is healthy and very resilient. You can see that in our gross margin still operating close to 80% despite all the headwinds that Anders just detailed. Secondly, what we will protect in our business model is our ability to innovate and be ahead of the curve. Our recent launches demonstrate the potential, and we're working on some really exciting innovations, which also have the potential to both drive consumer excitement and deliver margin protection at the same time. Finally, we're targeting another year of solid organic growth and are well geared for the holiday season.

Before we turn over to the Q&A, I'd like to add a short comment to our announcement a couple of weeks back. As you know, I decided to retire next year. I'm sure you will see -- I will see most of you before I leave. But I'd just like to say that it's been the greatest honor of my professional life to lead Pandora over the past 7 years. I'm incredibly proud of what we've built, and the company today stands on a very strong foundation and with a clear path to grow. Everything has a beginning, middle and an end. And now it's going to be time for me to spend my energy on other things. Anyways, I'm always very happy that I can -- I'm super happy that I can pass the baton to Berta, who I know will do a fantastic job.

So I'll just hand over to her to say hello.

Good morning, everyone, and thank you, Alexander. I am really honored and excited to take over as CEO next year. I've already been here a full year, and let me tell you, I see many exciting opportunities ahead of us, all that building on the vision to become a full jewelry brand. I mean, this past 4 weeks, I have worked even closer with you, Alexander, as we are planning the transition, and I think we both agree that we are making it a very smooth one and a very pleasant one. So I really look forward to speaking with you all in the near future and continuing the strong engagement that we have had.

So with that, Bilal, I believe we can open to the Q&A that will be headed today by both Alexander and Anders.

[Operator Instructions] First up, we will have Grace Smalley from Morgan Stanley.

Thank you, again, Alexander, for all your help, and congratulations to Berta. I have 2 questions, please. The first one would be on pricing. Could you just help us understand what you're now seeing on the pricing elasticity relative to your previous assumption of 1%? And more broadly, on your entry price point, I believe part of your strategy -- part of the strategy has been, especially on the back of some of the deep dive work you've done in Italy is related to increasing the offering entry price point. So could you just help elaborate on that strategy and any initial learnings from that so far?

And then my second question would just be on the creative innovation you mentioned with the idea of mitigating some of the margin headwinds in 2027. I appreciate you don't want to share too much detail given the competitive landscape. But can you just help us understand how you're thinking about testing those initiatives and managing the potential consumer impact and brand perception and whether you think kind of the work you're doing here could be a key differentiator as other players are also trying to offset some of these silver headwinds?

Okay. I can give it a go, and then, you guys file in as you see fit. So I think the elasticity assumptions still sit around the minus 1%. I don't think there's any change worth reporting here. Then, in terms of the entry price points, as you mentioned, so one of the things, obviously, it's not only about the price points as such, it's also about the innovation that we put in there and specifically around, let's call it, charms sub, let's call it, EUR 39, $39 or GBP 39, where I think we've probably not had enough exciting news. So a way to address that has been through the introduction of Minis, part of the Talisman range and a few other things that we have been bringing.

The other aspect of that has also been to relook a little bit on the pricing architecture, where maybe we've moved some price points above the 40 decile and then reconsidering whether that should be dropping down below again. So those are kind of the actions that we are taking. Very surgically, we're moving step by step.

Then, when it comes to the creative innovation, yes, we will keep the lid on this. But you can rest assured that the starting point is not COGS. The starting point is continuing to stay true to the Pandora DNA, which I mentioned in the presentation, around affordability, around precious metals. So everything we do is going to be thoroughly tested. We've, in fact, already done. I think it's over 20-odd thousand interviews on this to ensure that from a brand fit, concept fit, value fit, it sits smack in the middle of who we are. So the identity of this brand is not going to change due to the innovation.

Will it be a key differentiator? Let's see. I obviously don't have a crystal ball and to see what other people are doing around us. But surely, it will be a very, very strong consumer proposition that we are intending to bring to the market. That's as much as I can reveal today.

[Operator Instructions] Next up is Lars Topholm.

Actually, a related question. Maybe it's a bit naive to us because I'm not asking for 2027 guidance, but when you specifically point out, you expect to mitigate a material part of, I guess, the 370 bps headwind you see into 2027. How much is material part? Can I compare it to the 200 bps you mitigated this year? Or how should I think about that?

It's not an unexpected question, Lars, obviously, but thanks for that. The best way to look at it is actually to use 2025 as the starting point. And in this year, we have -- the P&L sits with a $28 in the P&L, give and take. And it's that increase from $28 this year to $48 that we are basing the company announcement on that will hit the P&L in 2027. That $20 uplift on silver, and the equivalent on gold, where we see that we can mitigate a material part. So it's actually a material part of the total, I'm just thinking about, 600 basis points of headwind across from '25 to '27, not just from '26 to '27. So a material part of that 600 basis points and that we see a way forward to how -- exactly how much and how fast as well, I should say, that's a bit too early, but we do know enough today that we could say over time, whatever that number of years is, we can mitigate a material part of it.

And so -- and then I would like to may be take the opportunity here to add a couple of points because with this creative innovation to the extent we can actually do it, it doesn't just have a nice margin uplift, or to Alexander's point, starting with a nice consumer opportunity for us, but it actually also reduces the commodity exposure in our P&L as well. So it exposes our earnings model less to swings in commodity to prices.

And then lastly, if I'll take the liberty of saying if you take a step back, then when we had the CMD in 2023, the starting point was an EBIT margin of 25% back then. And then, over the course of those 25 months since October 2023, we have had 1,000 basis points of headwind across commodities, FX and tariffs between 2023 and 2027. So it's pretty significant.

So what we're saying today is that with the combination of pricing, with leverage, with the Silverstone cost projects and now also creative innovation in a broader sense, that's actually the way forward for us to keep margins almost unchanged compared to 2023 despite all of this headwind and thereby protect our financial algorithm. That's quite okay in my book. I can't give you a hard number yet, even though I would love to do that. It's a little bit too early to do that, but we will definitely keep you posted.

But Anders, is it fair to say that if you expect to be able to mitigate unspecified material part, that long-term business model still have margins well ahead of 20%?

And then I guess a related question, maybe that's my second question. So when you talk about reducing the exposure to silver, I guess, in particular, it sounds to me like you're talking stainless steel. Maybe you don't want to comment on that. But can you comment on how that creative innovation affects the way you produce? Will it allow you, for example, to use more robotics? Would it allow you to do printing directly in metal? Can you talk about what that brings of other design opportunities? Will you do PVD coating, for example? Maybe some words on that.

Lars, I understand your question, but we will not answer that. This is way too sensitive to get into. The only thing I will point out that we will not turn into a costume jewelry player. We will still remain with precious metals. We're just finding another way to execute that. That's as much as we will do. I know you all want answers on this, but from a competitive standpoint, I'd be crazy to give you that today. So you just have to hang.

I think it's -- I think the statement Anders gave is a strong indication that we still believe that the earnings model that we're operating under today is going to be valid in the future as well. I think that's as much as we will stretch the conversation to.

Our next question will be from the line of Daria Nasledysheva from Bank of America.

This is Daria from Bank of America. I have 2 as allowed. Could you please talk a little bit about Germany, where like-for-like worsened a little bit despite an easier comparison base? How should we be generally thinking about the growth trajectory from here for the geography? And what are you seeing so far in October?

And my second question would be on gold and silver. Could you please help us understand a little bit about hedging? Doesn't look like you have been hedging much recently for obvious reasons and also given how much you hedged earlier in the year. But is it currently on pause and you're more in a wait-and-see mode, if you could help us there?

Okay. I can start off with the German question. I think that end line of this question is we will see Germany in growth next year, okay? I think that's the important point to make here. What we have sitting in the base, it's -- I mean, the Q3 wasn't necessarily much easier from a comp standpoint. In last year, in the same quarter, we grew by 45%. And I think prior year, in '23, we were growing 30%, 35% from memory. So over a 2-year stack, you're looking at over 70% growth.

The important point here is, and we made this comment last year, because a lot of that growth last year came because of this viral trend through TikTok. And we've been very clear to everyone that we didn't see this as part of the underlying business going forward. So, of course, when it happens, we're happy to accept those customers coming through the door, but we also need to be very clear on what actually becomes a sustainable business.

The good news on that, though, is when we look at the kind of customer base, over the last 3 years, we've literally doubled the customer base, which actually means that even a lot of these TikTok trends, we actually retain that customer to come back to us again. So that's the good news. Of course, when you have this huge mountain to climb year-on-year, it's not that easy. And the science around this isn't as precise because how much of the 45% was due to the TikTok versus Q2, God only knows.

So -- and as you say, the comps going into next quarter are easing up a little bit. It doesn't mean it's easy. But I think as we get into next year, we should see growth -- a healthy growth coming out of the German business. The brand is in super good shape. All our brand metrics are very strong in Germany. So this is purely a comp issue, nothing else.

And then, I hand over to Anders on the hedging or Bilal maybe.

Yes. Thanks for that question, Daria, on the hedging. You're right that we haven't hedged more of gold and silver since April, where we took the opportunity to hedge a little bit longer out. We stick to the -- our hedging guidance of hedging gold and silver production, silver hedging 70% of the next 12 months of production. That's our sort of rule of thumb. We will stick to that. But we will not get below that hedging level until a couple of months further out compared to today. And then, we'll, yes, go back and hedge as per usual once we get to that 70% threshold again.

Our next question will be from the line of William Woods from Bernstein.

I think last time we spoke, we talked about how you're balancing growth and margins, and I think you described it as a tightrope walk. How do you think that balance is going at the moment? And I suppose, do you think you'll need to give up more margin in the next year or so to drive further growth?

And then the second one is when you look at the slowdown in the underlying business, the like-for-likes, how much of this are you ascribing and do you think is due to consumer weakness versus an underlying downturn in the brand or with Fuel with more?

Let's just decipher your first question. So are you suggesting pricing playing marginal, just so I'm answering the right question here?

No, sorry, I think it's about the balance of growth in margins going forward. I think before we were talking about it being a high growth walk of kind of pulling a little bit of margin to invest in growth or either way. How do you think about managing the business going forward for growth or for margins?

I mean, we've always said that the algorithm of this business is by generating more traffic. And through more traffic, then you drive like-for-like. And then when we drive like-for-like, people like yourself like our stock, and then, the share price appreciates. That -- nothing in that has changed.

Now, of course, the sentiment around us and the macro around us has arguably become a little bit more challenging to the tune of what you see now. But I don't see that there's any change. We're not going to start driving this for EBIT margin. This is the wrong thing. But if I have to choose between the 2, what we've been doing in the last couple of years, we'll keep pushing the top line.

Then, on your other question, you actually have to peel the onion a little bit to get under the skin of that question because it's not a uniform answer. So it depends on where we're asking the question on the underlying growth. So if we look at it from a regional standpoint, which is kind of how in the future we'll report it, but it just gives you a slightly different perspective. Our North American business is growing at 6%. Canada is growing even stronger than that. So I don't have a real issue there.

Now, the consumer sentiment, we can always argue, but my starting point from a market opportunity is -- still continues to be very high. And we have great momentum, brand is strong, we're generating more traffic, and therefore, like-for-like is solid.

Then we go to Asia Pacific, that's grown by 5 points, similar dynamics. Australia has gone from having a quite weak macro in the last few years. That's turned a little bit more positive. I think we are playing to a better tune there. The brand is mature, but it continues to deliver good growth. Japan is in that region as well, where the business is really flying. And that's kind of an interesting insight, as we're thinking about spending more energy in that region going forward.

Then you go to LatAm, which grew by 1 point. We know we had some issues, as we were trying to detox our Mexican business, which, of course, is the lion's share of the business out there. So then kind of we go back to the old known mechanics, and that business responded. So going forward, that should improve.

And then we come into Europe. And again, Europe is minus 1% or flattish, pick 1. But within Europe, I mean, we have markets like Poland, or Eastern Europe, I should say, largely speaking. You have Iberia, Portugal, Spain, Greece. You have a number of countries in what we call now the EMEA cluster, which are in double-digit growth. And then, we have a couple of question marks in Europe. So we can talk about them. And each country actually has a slightly different mechanic.

So if I start with Germany that we just spoke about, yes, that posted a negative number, but actually underlying is a super strong business for us. And I think in the last 3 years, it's doubled, and it continues to be very, very strong. So no concerns whatsoever there.

Italy, we've detailed this in the past. We needed to drive up the local relevance a touch. We know that our opening price points. As we just discussed, we needed to do a bit more work in that space. Sequentially, we can now see that that's starting to bite, at least there's some green shoots. So I think Italy was only down 4 points or something, which is probably a pretty good outcome on such a short notice.

And then, we take France. France is super difficult from a macro standpoint. So I think that's not great. The brand, as we've said in the past, is not as strong as it needs to be. And on top of that, in the quarter, we decided to detox it from a promotional standpoint. So we also left a few points on the table just in order to set the brand for structurally getting to a healthier place. So I think that -- and that's not hugely different from what we've seen in the last few quarters.

And I think U.K., what -- also, I mean, you guys sit in the U.K., is not a great environment, as I read reports from other people that are kind of in the similar space. Nobody really is having a field day out there. And on top of that, we had some mechanical issues with our e-com business, which didn't help matters. So that's probably the -- of all my children, that's the one which is now getting slapped on the hand, not behaving. But it's the second biggest market for Pandora, and that needs to get in good shape sooner rather than later.

So there is not one single answer to say, is the consumer strong or bad? It's always the dynamic of the consumer sentiment in a particular market, the starting point and the health of our brand momentum in there. And between the 2, you will have a very different or mixed picture across the globe.

But another way to think about it is, in 70% of my revenue base, I'm growing 6% or more, and I'm talking like-for-like. And then I have these 4 European markets that are kind of dragging the picture down. So actually, I would say, underlying our business is really healthy in a difficult macro backdrop.

So I hope that gives some perspective to you.

Next up is Anne-Laure Bismuth from HSBC.

So I have 2 questions. The first one is on the margin headwind coming from the silver price. Would you consider to increase further prices going forward, ahead of the 1% to 2% normal price increase linked to the inflation?

And my second question is about the current trading. Just to confirm that you have seen a slight sequential improvement in September on the back of the launch of the Minis and Talisman collections. And so in October, where the improvement was coming from?

Thank you for those questions, Anne-Laure. On the first one, as you know, since -- over the last 18 months or so, we've done more on pricing than what we -- where we see we would normally do. If you go back to the Capital Market Day, we said that you should expect Pandora to do 1% to 2% of pricing every year. Then there's been 18 months here where it's been -- circumstances have been quite different. But going forward from here, still think about 1% to 2% of price increase per year as the -- as how we are going to run the business.

And then on the current trading?

Yes. I'll take that one. So yes, you're right, both comments are actually true. And it was that sort of pickup, and the trading was driven in part by the new collections that we launched pretty much through September. The drivers are pretty much similar of that dynamic in October as well. We won't get into the regional split. This was just 1 month. It's relatively small, but the drivers of that improvement are broadly similar.

I'll just add 1 point, which we didn't touch on when it comes to the U.S. pricing. Of course, we have the tariffs, and we would eventually want to offset some of that through different pricing or assortment mechanics. Now, that is also dependent on what happens around us. And if you remember what I said earlier in the year, I expected that we wouldn't see a lot of pricing activity up to the Christmas trading. And that's kind of what's playing out. So I think people are -- or brands are somehow pricing a touch.

And then my expectation would be coming into next year. Also when a lot of people have depleted probably inventory that they bought at a different spot prices are starting to seep through their sales, we might see some more movements in the U.S. specifically. And then I think we will obviously be agile and have a think about whether we follow or how we think about that. So -- but Anders is correct. What the baseline right now would be that 1% to 2%, but I'm sort of with the caveat of let's see what happens in the U.S. And who knows? Maybe the Supreme Court in the U.S. decides that tariffs isn't such a great idea, and then, we have a different conversation. That would be welcome, but who knows.

Next up is Thomas Chauvet from Citi.

Two questions, please. The first one on pricing, could you talk a bit about the rationale behind the price decrease in Europe, which I understand was around minus 5% in Germany, U.K., Italy and France? What volume uplift would you anticipate from these cuts? Are you considering similar cuts in the U.S. or the rest of Pandora? And do lower prices potentially allow for lower promotion in those European markets in '26 versus '25?

And secondly, on the creative innovation, I understand you cannot say too much whether it will remain a precious metals offering or stainless steel. In terms of production, however, given you're highly vertically integrated, how adaptable today are the Gemopolis and Lamphun production site we visited a couple of years ago or even the upcoming Vietnam factory, which is yet to open? Are these sites and the people able to change gear quickly? Or would you have to use OEM in an initial phase?

And just Anders, when you say in the release, such innovation is expected to mitigate a material part of the higher commodity price, effectively, you're suggesting that there is no gap to your very high gross margin of 80%. Is that correct?

I can start. We can probably tag-team this one. On the pricing, yes, there's been adjustments in a couple of markets in Europe. Will it impact the promotion? Well, in a perfect world, the answer would be yes, but it also depends on what happens around me. So if the market doesn't have volume growth, other people will be grappling with the same topic. So let's follow the market and see.

The benefit we have here is because we almost fully integrated when it comes to the -- let's say, the retail aspect of our business, so we can act really fast if there's something which we pick up on. And just on that, in the past, we didn't really use the pricing aspect as actively. I think what we're learning is that we can be quite dynamic going both up and down on pricing, and we will be using this going forward. So it's not going to be a monolithic aspect.

The other side of that could also be that, that would change promo mechanics, et cetera, and therefore, you can get a price impact or gross margin impact. So it's not all straight list price increase up or down. So I just think that it's going to be a more dynamic future. Do we project any of this to translate out of the markets you mentioned? Not at the moment. But again, as I said, it's a dynamic world. And in U.S., if anything, I need to be thinking up, not down, given the tariff impact.

Then, on the creative innovation, just I want to make one thing clear. And I said that we're going to remain a precious metal brand. So this idea that I know some of you guys out are imposing or putting words in my mouth on other material, be careful of that. We have never said it, and that's not the direction of the company.

Adaptability, yes, we are very adaptable. So, of course, part of the innovation, as we said, it's not purely about material, it's also the process of production that we're looking at. So it's a whole slew of things that we're considering. And then Vietnam, we are just building so that also gives us some flex. There could be instances where we go OEM, but we have time. This is the beauty of the hedge that we put in place. So this only needs to hit the market in '27. If we can do earlier, let's see, then we'll come and tell you that. But we have enough time to put this under our own 4 walls in order to also be efficient from a production standpoint.

And then, I'll turn it to you, Anders, to comment on the gap to gross margin.

Thanks for that question, Thomas. It's still too early for us to be super precise, but I think reframing what is converting of a material part -- of mitigating a material part of the headwind into gross margin, that means getting into sort of the high 70s, again. But what exactly that high 70s mean, that's -- we need a bit more work to be done before we can nail that down, but still very high gross margins.

Our next question will be from the line of Anthony Charchafji from BNP Paribas.

It's Anthony from BNP. Congratulations on the strong financial and nice volume improvement into Q4. I have 2 questions, please. The first one would be on the like-for-like into 2026. The consensus is at around 3%. Just if you want to share any comment on that one and the phasing between H1 and H2, as we are seeing volume sequentially improving.

My second question would be on the use of AI with demand planning, marketing or product creation. Historically, Pandora is not much into the buzz business with quite long lead time to market. Just curious if you're willing to put a bit more buzz into the business and if we should expect a bit more volatile like-for-like going forward?

Yes, I'll start with that, Anthony. For 2026 guidance, we'll get back to you in February. We'll trade through the holiday season. Obviously, we'll see where the world looks like. There's many variables, obviously, that goes up. We obviously will always have a good growth pipeline. That's our job to have, by definition, but we'll get back to you on February. Sorry for not being more specific right now. But yes, over to you on AI, Alexander.

Yes. I mean, we've actually been using AI or machine learning or LLMs or agentics. I mean, pick a label for several years across our business where it makes sense, okay? So when it comes to media buying, identifying customer cohorts. We've used it to augment design development. So this is already live and kicking. We just haven't been talking a lot about it. And I think we are relatively proficient.

The thing you're asking in terms of product development. What's important in our business is not the same model as an Inditex would have, for instance, where they need to launch new things all the time. What I just need? I need things that are robust and are going to be successful because we can't afford launching that many things in a year.

And also, given the nature of the category, where you have a very low purchase frequency, it actually doesn't make any particular sense to kind of gear up and launch tons of things all the time. This is a bit, I think, what Pandora did in the past, and it didn't really work because it takes time to build awareness of a collection. As we know, I mean, Pandora ME has been in the works for 4, 5 years. Now it's hitting a really nice mark.

We've just launched ESSENCE 2 years ago. That's now hitting a 3% share of business mark, and we need to get that up. And then, we're launching other things. So speed of that development is not critical for me. It's quality of that development that is more important.

Then thinking a little bit forward, we just came back from the Dreamforce, which is the largest IT gathering in the world, headed up by Salesforce, and they kind of own the space around CRM. We've been partnering with Salesforce, I mean, for 15 years, when it comes to our CRM platforms, our e-commerce, et cetera, et cetera. We are one of the people that have come the furthest in the world of applying the agentic approach, or AI, if you may, on how to improve the sales experience online. Because today, everybody kind of thinks that their online experience is fantastic. It's not. It's a pretty plain -- for those of you that are old enough, would remember the old mail order catalogs. That's what it is. It's just a glorified 2-dimensional experience online. It's irrespective of which brand we talk about, including Pandora.

And I think there's a huge opportunity in this space if we can use this type of technology to actually improve that whole experience that, frankly, when you go into a Pandora store, we give to you, and that's one of our competitive advantages. We need to find a way to translate that online because the one thing which is going to -- is absolutely sure is that in 5 or 10 years from now, more transactions will happen online than today. And therefore, we need to be offering them a more interesting experience than I think we do today. That's why we're throwing ourselves together with Salesforce in this development. So much more interesting stuff to come in that space.

Okay. It's very interesting. Maybe just 1 follow-up on this. Is your partnership with Salesforce means that you can't do anything with Shopify and maybe OpenAI to bring basically a sale in ChatGPT directly? Or can you still do this?

I mean, first of all, Shopify versus what we are currently doing ourselves, I think, is quite benign. So if they improve, well, maybe. But there's no exclusive from that sense. It's just smarter for us to house everything on 1 platform because then I have an integrated and a much easier pathway to kind of use my datasets. This may change in the future because this is an ever-evolving space. And I think OpenAI is actually working with Salesforce on some of their technologies. So one thing doesn't exclude the other, no, it doesn't.

Our next question will be from the line of Kristian Godiksen from SEB.

Yes. So I usually don't congratulate, but this time, I think, it's an order on a very successful journey, Alexander. And then obviously, congrats to you, Berta, as well. So we look forward to meeting you.

And then, yes, I'll restrict myself to the 2 questions initially. So first of all, the exciting design pipeline that you have planned for 2026 in the Fuel with more, can you maybe elaborate a bit on that? Is that expansions? Or is that a new collections in the line of ESSENCE and Talisman and the like?

And then secondly, more mechanical question on the network expansion. So I know you're not guiding for 2026 yet, but what is the outlook for store openings, and hence, network expansion into next year? Let's say you adjust for the full 100 Chinese closure stores, then you are at 150 this year, and that is compared to more than 200 in the previous 3 years. So -- and obviously, the days have increased just to maybe get an understanding of network expansions going into the coming years.

Yes, I'll deal with the first one. I mean, as you know, we don't disclose what we're doing when it comes to innovation, purely from competitive reasons. Sometimes, we can lift a little bit on the Kimono, when it comes to the Charms category because I think that we command and control that more. On Fuel with more, there is a full court competition across all lines. So I will not get into that other than we're quite confident that what we have coming is interesting.

So -- and then maybe you want to talk about the network piece, Anders?

Yes. Kristian, thanks for that question. I don't know whether the question comes out of that. If you look at the CMD target that we set a couple of years back, we said the 3% CAGR. And if you then add up what we did last year in 2024, what we are guiding for this year, then you can get to a super low number next year in order to get to the 3% CAGR. And we actually did discuss that before going into the announcement this morning that does it almost look sort of too stupid low what it takes to get to 3%. So maybe a way to answer...

No, no, that was not, Anders. That was not -- sorry, just to clarify my question, that was not the intention of the question. It's more that you only opened 50 stores this year. And then obviously, if you add back the 100 stores from China, then it's 150. And it's more on the run rate, and also, say, the network expansion growth contribution next year. Just based on the previous 3 years, you did more than 200 store openings. So it's more on the -- yes, on the underlying basis of doing store openings and network expansion.

Fair enough. The -- I think it's probably helpful to look at the concept stores only because that's where the majority -- it's much bigger revenue per store. So if you look at that number specifically, then from memory, we opened 137 in 2024. And this year, ex-China, which I think is the relevant comp base, we're opening 125. As of the big shift from a number of stores is -- underlying is on the shop-in-shops, but the revenue there per store is much lower. So another way to answer the question, Kristian, is that, no, we're definitely not at the end of that journey of network expansion.

Next up is Chiara Battistini from JPMorgan.

Congratulations, Alexander, for the great journey, and congratulations also to Berta for the new role. I have just a couple of follow-up questions actually. The first one is on taking all the pricing actions into consideration the increases and also the reductions, can you just summarize what kind of pricing impact we saw in Q3? What we should be expecting in terms of pricing impact to like-for-like to sales, like-for-like in Q4 and maybe into H1 '26 before any further price increase has not been announced yet?

And the second question on maybe the initial response to the Talisman and the Minis, I appreciate it's early days, but I was wondering whether you could share more color on what consumers these new collections have been attracting, whether you've seen a new consumer coming in or rather repeat purchase among the existing customers, please?

Do you want to do the first one, Anders?

Yes, I was just -- I would like to do that. Thanks, Chiara. I was just trying to do the math in my head just looking at the numbers specifically like that. And I'm looking at my IR colleagues here as well. But Q3, the ASP increase is something like high single digit, 8%, if I'm not mistaken specifically in Q3, that reduces to around 5% in Q4 because we are comping the price increase that we did in October last year and then getting into H1, it must be pretty much around 5% still because we only get to an even lower comp in April 2026. There, we'll then be getting down to the low single-digit level by then. Hope that helps.

And then on your question on Talisman and Minis, it's 6 weeks. So I will not comment on anything other than that it's meeting -- minimally meeting what we had anticipated internally and actually a bit more than that. But that -- what is an expectation, it's a forecast, and who knows whether that's good, bad or indifferent. So -- but we consider this to be off to a good start. What always happens when we launch, and I think this is having worked on different brands for the last 35 years, the initial customer that comes to the door is your existing customer.

And then, as time goes by, that kind of shifts so you get more and more new coming through the door. So that's the only thing I would say on the first 6 weeks of trading, but 6 weeks is nothing. So it's a little bit too early. I think, when we get into the February call, then we'll have a couple of months under the belt, and then, we can give you a little bit of more color on who and exactly what they're behaving, so yes.

Next up is André Thormann from Danske Bank.

Can comment a bit -- I thought I was already unmuted. So I just have a few on Project Silverstone. I wonder if you can give a bit of color on these 50 to 100 basis points of offsetting in '26? What is the key drivers here? And maybe also if this is something that will help you in 2027 offsetting further silver price headwind?

Thanks for that, Kristian -- Andre. So there's no sort of dominating bucket in the 50 to 100 basis point margin uplift last -- next year. It's rather a range of smaller things or medium-sized things, but that's not sort of one silver bullet, if I can call it that. But some of the bigger buckets that sits in there is continued very good productivity improvement every year in our crafting and sites in Thailand.

We have seen quite a number of opportunities within procurement in general. We have been strengthening that muscle during 2025 and have quite a nice pipeline of things that we can do. Then, we see opportunities in how we operate the stores across all the P&L lines that sits in the stores from how we are manning the stores with our colleagues, the point-of-sales material, visual merchandising as well. And then, there's a long tail of other things where we see that we can take out costs.

And yes, we actually have decided to keep this cost muscle, Silverstone, in the organization as a permanent setup, small setup, but a dedicated small setup that will keep looking at cost opportunities beyond what you would do only, if I can call that in a procurement setup. So -- but someone who can also look across functions, across the value chain on where we can take out cost.

Our next question comes from the line of Alison Lygo from Deutsche Bank.

Just 2 quick last ones for me, please. First is on store contribution. So you've increased your guidance for store contribution in the year. Where do you think you're at now in terms of reaching a share of mature revenue within the first year?

And then the second one, just on the U.K., you mentioned some issues with the online platform. If any more detail you could -- you can share on that? Is it resolved? And kind of how much of a drag do you think that was within the third quarter?

Alison, if I take the first question, and if I understood the question right, then we are -- the stores -- when we open up a new store, it actually ramps up, I'm almost saying, surprisingly fast. So we're almost reaching sort of run rate level in year 1. There is a small pickup in the second year. But when you look at the EBIT margin that we're generating in a store that we opened in year 1 in the 35% to 40% EBIT margin in year 1, you can also thereby sort of conclude that revenue is picking up super fast. So it's a revenue maturity in the 90s already in year 1.

Yes. On the U.K. online, so it actually declined more than our store network in the quarter, which is the only place globally, where it did so. So that is a drag. It started somewhere in Q2, and it's kind of gone in. It's a mixture of some commercial decisions that we've made. There's some technical aspects that we are dealing with. So it's 5 or 6 different things. We're all over it. As you can imagine, the U.K. eSTORE is our second biggest eSTORE globally. So that needs to be addressed. But there's all hands on deck to get that fixed. Yes, that's as much as I can say today.

Next up is Klaus Kehl from Nykredit.

Yes. I noticed that you have started to talk more about Japan. Could you elaborate a bit on what's going on out there? And what the potential is in this market?

And then my second question would be that I'm a little bit confused about Mexico. You've been in detox mode for quite a number of quarters, but how far are you with this detox? And are you starting to see growth again in Mexico? That will be my 2 questions.

So the Japan story has -- there's a few things to add. So many years ago, we were there with the distributor. The distributor planted a few flags, which are -- were mainly in, let's say, the tourist -- so we actually -- we had a small business, not very profitable. That was kind of even keel, let's say, but we're not really speaking to the local customer.

So some 2 years ago, we decided to give it a shot and go after the local customer, which also meant that we needed presence in other places than just the kind of, let's say, the tourist areas. So we are now up to like 50 points of sale or 60, thereabouts, mainly focused in the Tokyo and Osaka area, which obviously, the addressable market is absolutely huge.

We've added a little bit of local earned media, let's say. We've used some K-pop influencers. We've applied a bit of a more media investment that's what we've done in the past. We've shored up our store operation a little bit, which was also not great. And that's -- and then actually, we took our prices up a little bit in order to pay for these extra investments, not a huge amount, but some, and that's pretty much what we've done. And it looks like all the growth that we are gaining now in Japan is coming from the local customer.

So it's very encouraging steps because the other insight for us is, obviously, we don't have to completely localize, let's say, our global model. That was always a question mark when we went into Japan because everybody saw everything is so different. And, of course, when the small market and everything is different, is not so attractive for a company like ours, where we live leveraging the scale of one model. But -- so that's been quite interesting to follow, and that seems to be going on quite well.

Mexico, I think the story in Mexico is of a different nature. So all of LatAm essentially has a price index, which is significantly higher than anywhere else with the view that we were serving the top end of the socioeconomic pyramid. So going after the A and B type of consumers because, let's say, what we call middle of the market in other markets, well, wouldn't necessarily be very affordable for them. You can think of our core customer as being as the people that work in our stores. That's the core constituent of a Pandora customer. So therefore, they went after a slightly different audience. That worked really well up to a point. And with that higher price point, they also adopted a high-low model, which we don't really use anywhere else in the world, where we would have a lower starting price, and then, we do shallow discounts, let's say.

We've tried -- and at one point, of course, when you only target, let's say, 10% of the population, you will start reaching maturity in terms of penetration. At 1 point, I think 1 or 2 year -- well, probably 2 years ago, we started reaching a quite mature part of that sliver of the population.

And then, the answer to get more penetration was to do more deep discounting promotions. And that's the part which we've set for a while that we were trying to detox away from. What we're finding, of course, is then we don't have enough penetration opportunities. So we're kind of rethinking a little bit the model. But we were losing too much volume by coming off these promotions. And meanwhile, it's also important to mention is that competition around us has gone even more promotional than maybe what we saw 2, 3 years ago. So it's kind of different things that are happening to the dynamics.

So what we've done now is we've gone back to, let's say, our base model of high-low to fight and hold the business where it is, as we're trying to think of how can we pivot and open up the brand to more consumers. So we have some thinking in that space, which we hope to be bringing to the market in the next, I don't know, a couple of months maybe. So -- because Mexico still represents a very interesting market for us. It's highly profitable despite this kind of high-low model, which is different from elsewhere. But thinking about it a bit more long term, we want to open up the addressable market. So there's some additional thinking happening there.

Okay. But just to be clear, are you in positive or negative growth territory in Mexico?

We are on a better trajectory than we were in the beginning of the year, which was negative.

Next up is Piral Dadhania from RBC.

So I have a question on the sort of the contribution to like-for-like in Q3. Thank you for sharing, Anders, the ASP contribution as being plus 8%. Could you just help us understand if the volume growth in Q3 has modestly improved versus where you were in Q2? And are we right to assume that it's running at probably negative mid-single-digit, give or take?

And then my second question is just around the performance by price point across the price architecture of the offer in Q3. I think you said you were a bit disappointed with the Fuel with more performance in the period that, I think, comes at a higher price point on average. Is it fair to say that the lower price points are perhaps performing better than the higher price points? And as it relates to consumer behavior, are you seeing any trading down as the macro becomes more challenging? Any insights into consumer behavior would be helpful.

Piral, maybe I'll start with the first question on the unit. You're right that the -- sort of the unit decline in the third quarter as per design, given that we are targeting a minus 1% elasticity. It was around mid-single digit down. Then, I think I should note and add that now we have October behind us. I think we can also say on this call then, in October, we are comping the price increase that we did in October 2024. And as expected, we've seen much better unit development in October, exactly as per design, so getting closer to a flat -- not completely flat unit development, but close to flat.

Okay. So how do we answer this question? Because it's quite a complex question that you're answering -- asking. The first point to make is we don't necessarily see any trading down. That's somehow not what we see in our business, have never really seen. And then, if you look at Fuel with more and dissected a little bit, so actually, our Timeless business is growing by 4%, but a lot of that is eaten up by Signature, which is a collection that we have consciously decided to down prioritize, and that's quite painful. So that eats away some of the benefits.

And then you look at ESSENCE, it's up 13%; Lab-grown Diamonds is up 19%, but in units, it's up over 65% as -- if you remember, we said we'd pivot from the high price points to the lower price points with the kind of product offering that we have there. So it's actually at the face, the 2% looks disappointing, but partly that's driven by the Signature, really not contributing properly. That's probably the best way to answer your question. Then, within the different pricing deciles, there is -- and there's so much dynamic going on between the collection Studied. We would need 2 hours to detail that out. And I'm not even sure it's particularly meaningful. So I think I'll just stop there.

Sure. But maybe I could ask specifically just around the U.S. I was thinking more -- maybe I wasn't clear, I apologize. Thinking more about the specific headwinds you're facing in the U.S., which is also your biggest market, the tariffs, the government shutdown, the reintroduction of student loan repayments, is that driving any changes in terms of performance by price point for the U.S. specifically?

Not really. What -- I mean -- and I'm not even sure it's a major drag. But, of course, with all these ICE agents running around, we can see that a lot of the Latinos, which is a significant part of our audience in the U.S., they are less, let's say, present in the shopping malls in the southern parts of the U.S. So that has some impact, but that's probably the only one, I would say. The rest on a price point, no, there -- I see nothing there.

And our last question will be a follow-up from the line of Lars Topholm from Carnegie.

Yes. I actually don't have a follow-up. I signed off again because my question has already been asked.

That's all right. Then, over to you, Bilal.

Thank you for handing back to me. And thank you every much, Ivan, for dialing in. Just hand over to Alexander for a very, very final comments. Any questions or any follow-ups, do let the Investor Relations team around, around for rest of the day, of course, as well.

Yes. Well, first of all, thank you for the attention. I was just saying to Bilal before we went in here, we are covering Q3. We are talking about current trading. We are talking about prediction for '26. And on top of that, we're also trying to kind of look in the crystal ball for '27. So it's actually quite complex message to track this time around. But I think that at the end of the day, if I kind of zoom out, the changes which we've done to the company in the last few years still kind of somehow continues to work.

The earnings model works. Yes, we have headwinds like any business will have here and there. I think we're super agile on trying to think about how to offset that going into the future, more short term with Silverstone and pricing and these type of actions, longer term through the innovation and quite exciting stuff, which, unfortunately, we can't detail today, but we wouldn't be saying here that we can offset material parts of this headwind if we weren't excited about it. So I think actually the company is in really good shape, and we're super excited for Q4.

And on that note, we'll see you in February. Thank you very much for today.