Value retailer Poundland reported a mixed bag of results to the full year ending 27 March. The retailer rolled out its expansion across the UK and Internationally throughout the year and worked on converting the full 99p Store estate which it acquired in late 2015.
Sales rose by 9.7% on a constant currency basis and 9.3% to £1,214.8m on an actual currency basis from £1,111.5m in 2015.
However, like-for-like sales fell by 3.9% from a 2.4% increase year-on-year on a constant currency basis.
Total group sales increased by 18.7% to £1,326m, up from £1,116.9m the previous year. Pre-tax profits plummeted by 83.7% to £5.9m, down from £36.2m in 2015.
Poundland opened 60 net new stores during the period as well as 190 conversions of 99p Stores to Poundland, taking its full estate in the UK and Ireland to 896 – up from 588 in 2015.
The highstreet retailer confirmed that the conversion programme of its competitor estate is now complete with 235 sites converted into the Poundland name and format and 17 to be closed or disposed of.
Further, the group opened 10 Dealz stores in Spain, doubling its number in 2015. Total sales in its international arm made £15.5m, significantly up from £5.4m in 2015. An extension trial will continue in Spain until November 2016.
“This has been a challenging but transformative year for Poundland and the acquisition of 99p Stores has further strengthened our position as Europe’s biggest single-price discounter. With all of the 99p Stores now converted to the Poundland fascia, we are strategically well placed for progress under Kevin O’Byrne’s leadership” said Darren Shapland, Chairman of Poundland.
“After a period of significant change, including an unprecedented integration programme at pace, Poundland now has a unified estate of over 900 stores. The retail environment remains challenging, but with our significantly enlarged store portfolio, greater scale and ability to focus fully on trading our stores, I believe we are well placed to make progress in the year ahead. I believe that under the leadership of my successor, Kevin O’Byrne, Poundland will return to growth. I wish Kevin, the leadership team, all of my colleagues and supplier partners every future success” added Jim McCarthy, Poundland Chief Executive.
Kevin O’Byrne, Chief Executive Designate, said: “It is very clear to me that Poundland’s brand, position and focused model are real strengths and resonate strongly with our millions of customers. I’m looking forward to taking up the CEO role in two weeks’ time and the committed, talented and passionate people I’ve encountered throughout the business give me further confidence that Poundland has a bright future at the heart of the discount sector.”
Talks have recently emerged that South African retail group Steinhoff may be interested in acquiring the Poundland estate. However, a formal bid has not been made.