Poundland's parent company Pepkor has released its latest financial results for Q1.
Poundland: positive results driven by clothing
- Total revenue: €516m (GB£433m) an increase of 0.6%
- Stores: 882 an increase of 0.2%
Despite the broadly flat performance Pepkor was happy with the results, given the weak UK consumer backdrop.
The results built on the positive Q4 results of 2018. Pepkor has said this is being primarily driven by the successful introduction of clothing 'shop-in-shops', which are now in over 300 stores. By extending the product range and supporting a broader range of price points stores are performing well and delivering strong returns on invested capital.
Poundland opened 13 new stores in 2018 and relocate three stores to larger locations. Poundland is expected to continue to expand in 2019, but Pepkor have not said by how many stores.
Developing its proposition in a competitive channel
Despite the closure of Poundworld in July 2018 we are seeing increasing competition for all the variety discounters. This includes the launch of One Below, the new chain created by Poundworld founder Chris Edwards. But also, format innovation in existing retailers as they continue to develop concepts to engage value seeking shoppers.
Poundland recently announced plans that it was creating a new transformational team to develop its store proposition, in The Grocer. This will be led by Mat Ankers. Ian Keyworth will report into him as head of operational change. Poundland's retail director, Austin Cooke, has said possible developments are making the stores closer to department stores.
Dealz: continued expansion
Dealz stores continue to perform well, with Spain said to be delivering positive like-for-like performance. Pepkor is looking to build on this and expand the estate further. This includes entering new market Bulgaria with 10 stores, and opening a further 14 stores in Poland. This will take the total Dealz stores to 60.
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