Poundland posts festive sales rise as discount chain expands food and clothing lines
The discount chain’s owner, Pepco Group, said like-for-like sales rose 2.4 per cent across Poundland stores in the UK and the Dealz chain abroad over the three months to the end of December – its key quarter, which accounts for around a third of annual sales.
It opted to close certain sites despite being allowed to remain open, and said sales among stores that traded throughout the quarter rose 4.3 per cent across the two brands.
Towards the start of this month, Poundland announced that it was placing 44 stores including a flagship branch on Edinburgh’s Princes Street into “temporary hibernation” amid growing political pressure to close more of the retail sector to control the spread of Covid-19.
The chain said that 44 of its 900 or so outlets would be affected. As an essential retailer, the vast majority of stores will remain open for business to serve their communities.
Pepco cheered a good response to its Pep&Co fashion brand, which has been rolled out to 300 stores in the UK, as well as more homewares lines and further moves to introduce new price points above and below £1.
But the wider group saw like-for-like sales fall 2.1 per cent, dragged lower by a 6 per cent drop at its international chain Pepco, which is not deemed an essential retailer and was hit by enforced closures due to lockdowns across Europe.
The group said its 917 Poundland stores in the UK put in a resilient performance in its first quarter, despite many being based in high streets which have been decimated by Covid-19 restrictions.
Andy Bond, chief executive of Pepco Group, said: “We anticipate that the consumer backdrop will remain challenging in the short-term.
“However, with our established growth strategy, centred on significant future store expansion within a structurally advantaged discount retail segment, and strong financial base, we believe that our future growth opportunity is greater than a year ago.”
The firm has launched chilled and frozen food ranges in its stores over the past year and revamped a further 38 Poundland shops in the Christmas quarter to add the lines, as well as new price points.
In October, it bought frozen food retailer Fultons Foods, which it has been working with on the food ranges, as it looks to ramp up the new offerings.
The update showed Pepco Group continued to open new stores in the quarter, up 15 per cent to 3,128 shops overall, with plans to launch 300 Pepco outlets in the full financial year and up to 70 Dealz sites.
Poundland is part of South African conglomerate Steinhoff, which has been battling to raise funds and cut debts since an accounting scandal drove it to the brink of collapse in 2017.
Steinhoff said on Monday it was dusting off plans for a possible stock market flotation of Pepco after the move was put on hold last year due to the pandemic.