Poundland reports 21.6% yearly sales increase

Strong annual sales made Poundland confident enough to edge up its store opening programme as the discount chain continues to eye opportunities in Europe.

Poundland expects to open at least 60 new stores this year, up from a typical target of 50, the retailer said on Monday. The chain, which currently operates from more than 400 outlets, opened 62 new stores in the year to April 1.

The retailer is researching where it might expand in continental Europe, but will not open any stores outside the UK and Ireland this year and no decision about which countries to target has been finalised.

“We are very aware we need to get this absolutely right” Jim McCarthy, chief executive of Poundland said of the group’s European development.

Poundland, which is majority owned by private equity firm Warburg Pincus, made its first foray outside the British market with entry into Ireland last year where its discount format “has particular resonance with the Irish consumer”, Mr McCarthy said.

“Value-end” retailers have seen sales rise since 2008 as the economic downturn encouraged more consumers to look for bargains. The retailer, which operates in the country as Dealz, opened nine stores there during the year and plans this to rise to 25 by the end of next March.

Sales at Poundland rose 21.6 per cent to £780m in the 53 weeks to April 1. Underlying earnings before interest, tax, depreciation and amortisation were up 26.5 per cent to £40.1m.

Source : Jennifer Thompson – Financial Times
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