Pepco sales rise as growth strategy progresses

Sales grew 11.1% across the group, with Pepco sales rising 15.8% and Poundland rising 4.9% on a like-for-like basis in the six months to March 31.

Revenue increased 22.8% to €2.8bn (£2.4bn) and gross profit rose 20.1% to €1.3bn (£1.1bn). Underlying EBITDA increased 11% to €377m (£325m).

The group credited its results to its progress in its growth strategy, which saw its total number of stores at the end of the trading period reach 4,127 – up 12% year on year.

It is on track to open at least 550 net new stores during the current financial year and is confident in the EBITDA outlook for the full year.

Pepco Group chief executive Trevor Masters said: “The Group continued to make strong progress against our strategic objectives over the half year, while delivering an increase in revenues and underlying EBITDA. We opened 166 net new stores in the period and are confident of meeting our target of at least 550 net new stores this financial year, as part of our targeted and profitable opening programme.

“Our growth strategy in Western Europe is progressing well, reflecting the strong appeal of the Pepco brand to customers across the whole continent.

“Italy, where we recently opened our 100th store, and Spain – which is benefiting from our combined clothing, general merchandise and FMCG offer – continue to be our largest and fastest-growing Western European territories. In May, we were delighted to launch the Pepco brand in Portugal.

“As we highlighted previously, inflation remains at elevated levels in Central Europe, against which trading in Pepco stores has remained challenging during the third quarter to date. Despite this, we have continued to do the right thing for customers on a budget by maintaining our price leadership and growing our market share, while focusing on the cost of doing business in these inflationary times.

“We remain well positioned and in the second half will see gross margins trending upwards, as we benefit from the tailwinds on certain input costs, including commodity and freight. We are focused on executing our strategy and remain on track to deliver full-year EBITDA growth in line with previous guidance.

“I would like to recognise our colleagues and suppliers across the business and thank them for their hard work and commitment to serving our customers.”