Poundland's sales hit £1bn amid investigation into 99p Stores acquisition

The retailer said the rise in total sales, excluding Spain, was an 11.4% jump on an actual currency basis to £1.11bn for the full year to March 29.

The results followed 60 net new store openings in the UK and Ireland.

But Poundland said like-for-likes for the year also increased by 2.4%, including a 7.1% spike during its fourth quarter, ahead of the unveiling of its preliminary results on June 18.

Bosses said pre-tax profits for the year were “expected to be in line with market expectations” after a “solid” performance in “tough trading conditions.”

The retailer added that its Spanish trial was “proceeding to plan” with five stores at the end of the fourth quarter, although it failed to provide an update on its performance in the European country.

Investigation

Poundland said it would “continue to carefully consider the UK Competition and Markets Authority’s announcement in relation to its Phase 1 review of the group’s proposed acquisition of 99p Stores, together with the full detail behind it.”

The retailer said it would make a further announcement on the buyout in due course.

As previously reported by Retail Week, Poundland agreed a deal to buy its closest single-price competitor for £55m back in February.

But authorities found that the buyout could worsen the position for shoppers in 80 shopping areas across the UK, due to a potential “reduction in quality”, fewer promotions and store closures stemming from a lack of competition.

Poundland chief executive Jim McCarthy said: “After a solid quarter of sales growth, Poundland’s revenue for the 2015 financial year was over £1bn for the first time. Despite tough trading conditions, Poundland continues to perform well and we served an average of 5.3 million shoppers a week during the quarter.

“We have managed our costs and cash well, and we expect underlying pretax profits to be in line with market expectations for the year as a whole. We achieved our target of 60 net new stores in the UK and Ireland and have a very strong pipeline of store openings for the current financial year.

“We expect to continue to deliver our growth strategy in the new financial year, notwithstanding some headwinds from a weaker Euro and a tough comparable in the first half.”