Pepco revenues rise in 'golden quarter'
Poundland and Dealz owner Pepco had a good Christmas quarter compared to many in the UK and European retail sectors. But its same-store sales still fell 2.1% due to pandemic-linked store closures. Reported revenue rose 9.1% to €1.188 billion.
Yet the value retailer said that trading in stores that were open for the full duration of any week in the quarter to the end of December was up 5.5% on a like-for-like basis. At Pepco stores it was up 6.6% and at Poundland/Dealz it rose 4.3%.
Its Pep &Co clothing brand is available in 342 Poundland/Dealz stores and the company said it did well during the quarter, boosted by the continued extension of product ranges to price points above and below the £1 anchor price point. This included the successful launch of a widened homewares proposition under the brand.
The company, which is part of South African conglomerate Steinhoff, said it made continued strategic progress and that its peak trading was “resilient” across all its retail brands. The Christmas quarter represents around a third of its entire annual revenue and an even bigger proportion of earnings.
Its strategic progress included increasing the size of the store portfolio while strengthening the customer proposition in all brands.
Pepco added 87 new stores in both Central/Eastern Europe and Western Europe and enlarged or relocated a further 18 stores. This programme included opening further new stores in Italy and the first stores in Serbia.
Each of these countries “is trading measurably ahead of expectation”. And the roll-out of the Dealz format continued in Poland, the Republic of Ireland and Spain.
It also said 318 existing stores were updated through store conversion programmes in both Pepco and Poundland.
Group CEO Andy Bond said: “It is pleasing that once again our disciplined adherence to our clear growth strategy combined with a focus on day-to-day retail execution has allowed us to successfully navigate a turbulent trading environment. Our revenue performance clearly signals the strength of each of our retail brands and customer offers and our resilience to short-term Covid disruption.
“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. Accordingly, we remain confident about our prospects for continued growth across Europe in the balance of the financial year and beyond.”
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