Poundland sales top £1bn for first time

By Michael Stones contact

- Last updated on GMT

Poundland sales topped £1bn for the first time
Poundland sales topped £1bn for the first time

Related tags: Executive director, United kingdom, Depreciation

Discount retailer Poundland has posted sales up by 11.8% to top £1bn for the first time, in full-year results to March 29 but warned trading in the first half of this financial year will be subdued.

Total sales reached £1,117M compared with £997.8M last year.

Like-for-like sales rose by 2.4%, on a constant currency basis, with earnings before interest, tax, depreciation and amortisation (EBITDA) up by 9.9% to £59.4M.

Pre-tax profits climbed 18.6 % to £43.7M, while earnings per share were up by 24.4 % to 13.6p. (2014: 10.9p). It attributed the performance partly to one-off factors, such as the children's craze for loom bands.

Sales for the 11 weeks to June 14 were ahead by 4.1% on a constant currency basis.

Opened 60 new stores

Poundland opened 60 net new stores during the year, boosting its estate in UK and Ireland to 588 stores. Its retail park stores now total 87 in the UK and Ireland. A further 60 new stores are planned for next financial year.

The budget retailer’s business in Spain – branded as Dealz – expected to operate 10 stores in the country by the second half of this financial year.

The business claimed to serve 5.3M customers served a week, including nearly 300,000 in Ireland.

Last September the firm opened a new 32,516m2​. warehouse in Harlow, Essex.

Commenting on its proposed acquisition of 99p Stores​, Poundland confirmed the Competition and Markets Authority (CMA) had moved to a phase two investigation, with a decision expected in October.

Announcing its stage two probe, the CMA said in April: “Without competition from 99p Stores, there is the possibility that Poundland may have the incentive and ability to deteriorate its offer in these areas [fast-moving consumer goods] to the disadvantage of customers that have come to rely on their offer. Given the potential impact on customers, we will now open a detailed investigation into this merger unless the parties offer suitable undertakings.”

Poundland said its planning to integrate the 99p Stores business was well advanced.

International expansion

Jim McCarthy, Poundland’s chief executive, welcomed, what he called, a record year of sales and profit growth. “We saw strong trading in the UK and Ireland and our international expansion plans in Spain are proceeding well with seven multi-price Dealz stores now open.”

Despite the challenging start to the year, Poundland will continue to be “the standard bearer for genuine and amazing value on the UK's high streets and retail parks,” ​he added.

The results were said to leave the business well-placed for the key Halloween and Christmas trading periods.

Meanwhile, Poundland announced the resignations of Richard Lancaster, from his position as executive director, and Paul Best, a non-executive director. Both left the firm yesterday (June 17).

 

Poundland results - at a glance

  • Total sales reach £1,117M compared with £997.8M last year.
  • Like-for-like sales rose by 2.4%
  • Earnings before interest, tax, depreciation and amortisation up by 9.9% to £59.4M.
  • Pre-tax profits climbed 18.6 % to £43.7M
  • Earnings per share were up by 24.4 % to 13.6p
  • Sales for the 11 weeks to June 14 were ahead by 4.1% 

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