Poundland has revealed falling sales so far this year, but remained positive about its financial situation in the face of an accounting scandal that’s decimated its owner.
In the six months to June 30 the discount retailer saw sales drop five per cent to €1.32 billion (£1.1 billion), while like-for-like sales grew 1.7 per cent reportedly outperforming the wider market.
It attributed this drop to the loss of 60 stores, which it was forced to close following the acquisition of 99p Stores in 2015 due to overlaps with its own shops.
Meanwhile it hailed the success of the roll out of its fashion brand Pep&Co, touted to be the new rival to Primark.
In June the retailer announced the completion of the “supercar like” rollout of Pep&Co across 300 of its stores, with like-for-like sales at those stores reportedly jumping 7.7 per cent over the period.
“Poundland continues to make good strategic and operational progress to widen its appeal,” its owner Pepkor’s boss Andy Bond said.
“It’s extending the value it can offer through additional price points and the introduction of Pep&Co fashion ‘shop-in-shops’ is giving customers a distinctive reason to shop on the high street.
“Underpinned by the introduction of tighter retailing disciplines, Poundland is changing at a pace led by its customers who are really embracing the difference.”
Pepkor is part of the South African retail conglomerate Steinhoff, which saw 90 per cent wipe off its share values at the start of the year due to an accounting scandal relating to a £5.3 billion black hole in its financial reports.
Despite this, Steinhoff’s UK retailers including Poundland, Bensons for Beds and Harveys have remained in relative health.
In January Pepkor moved to distance itself from the embattled firm, and secured a £180 million loan to offset the financial pressures piled on by the scandal.
Bond added: “I’m very pleased with the progress that the business is making across the board, undistracted by events at our parent company.
“Both retail businesses are cash-generative, profitable and stable, with management teams encouraged by the strong operational progress we’re now making.”