Fashion deep dive gives Poundland Christmas cheer
Poundland has received a big boost from its major move into the clothing sector and despite the problems at its South African parent company, its fourth quarter (the three months to September 30) and full-year were strong.
In a trading update, Pepkor Europe, which also runs the Pepco and Dealz chains in Europe, said Q4 revenues were up 12.9%, an acceleration on the 10.6% rise for the year as a whole. Total revenue topped €3 billion/£2.75 billion for the year and Q4 sales reached £709 million at the business that now runs 2,360 stores across Europe.
Pepkor is owned by scandal-hit Steinhoff International, but its parent’s accounting issues don’t seem to have hurt interest in budget products in the UK with Poundland’s growth aided by the addition of the Pep&Co clothing range in almost 300 concessions in Poundland stores. That rollout helped propel Poundland into the top 20 list for UK fashion retailers by volume.
“I think we have done a good job of making the shopping experience better for customers,” Andy Bond, Pepkor Europe’s CEO, said. “When times are tough, people hunker down a bit, so the discount sector is slightly protected beyond other retailers.”
Bond added that while the company has “had a good year”, it has also “had to handle harder environments than usual. It has seemed that every week there has been an extra crisis to deal with.”
It closed off one avenue of problems in Britain by shutting around 60 of the former 99p stores that had been performing poorly and that helped overall like-for-like growth at Poundland.
Bond also said that “Poundland’s return to like-for-like growth is encouraging and the continued growth of Pepco clearly evidences the broad appeal of their value for money proposition in existing and new markets. Although relatively small, the performance of our Dealz businesses in both Spain and Poland are particularly pleasing.”
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