Poundland reveals rising sales and profits in maiden results update

Underlying pre-tax profits jumped 23.5% to £36.8m in the year to March 30.

Like-for-likes were up 1.9% after a 1.7 decline last year. Poundland chief executive Jim McCarthy said this was driven by a “continued focus on providing customers with amazing value every day and a return to more normal competitor opening activity”.

Total sales increased 13.3% to £997.8m.

Since year end sales growth has accelerated, with revenue rising 18% to £262.6m in the first quarter to July 2. Poundland said this was driven by “the late Easter, our continually improving product offer, stronger like-for-like sales growth and a strong new store opening programme”.

The retailer opened a net nine stores in the quarter. It also opened its first store in Spain yesterday, in Torremolinos, under its multi-price Dealz fascia. Poundland plans 10 stores in Spain over the next two years.

McCarthy said: “Trading in the first three months of the new fiscal year has been strong as our retail proposition continues to gain traction through offering amazing value to savvy consumers. After a pleasing start to 2014/15 we are confident of further progress through the year whilst recognising our critical third quarter lies ahead of us.”

In the 12-month period Poundland opened 70 net new stores, taking its store count to 528.

The retailer will open a further 60 shops this year as well as a new 350,000 sq ft warehouse in Harlow, Essex, in August.

It said it serves nearly 5 million customers each week, 22% of whom are from the AB demographic.

McCarthy said: “We believe the shopping behaviours adopted during the last five or six years will continue as the economy and consumer confidence improve and that Poundland is well placed to benefit further from increased footfall and discretionary spending.” 

He added: “This was a transformational year for Poundland culminating in our successful IPO in March. I am pleased to report that in our maiden set of results we have delivered excellent growth in sales, as well as in underlying EBITDA and EPS, whilst generating strong cash flow. 

“In addition to strong trading in the UK, the next leg of our international expansion is now underway.”

Poundland chairman Andrew Higginson said:  “These results show that we are continuing to build on our strong growth record, as set out at the time of the IPO. I expect that Poundland will continue to benefit from its strong trading platform, its universal appeal and the structural change in consumers’ shopping behaviour.”