Pepco Group posts Q1 like-for-like sales growth of 5.5 percent

Pan-European variety discount retailer, Pepco Group, owner of the Pepco and Dealz brands in Europe and Poundland in the UK reported like-for-like (LFL) sales growth of 5.5 percent in the first quarter against a challenging comparative of 3.9 percent in 2019. The company said in a statement that stores not impacted by Covid-related closures, traded strongly delivering LFL growth of 6.6 percent consistent with that delivered in the first quarter of FY20, underpinned by continued investment to strengthen the customer offer. Revenue growth, on a constant currency basis of 9.1 percent and reported 3.9 percent, reflected the ongoing expansion of Pepco and Dealz formats.

Commenting on the results, Andy Bond, CEO Pepco Group, said: “Our revenue performance clearly signals the strength of each of our retail brands and customer offers and our resilience to short-term Covid disruption. We remain confident about our prospects for continued growth across Europe in the balance of the financial year and beyond.”

Pepco Group’s Q1 performance across its businesses

At the close of the quarter, the Group traded from 3,218 stores, an increase of 14.6 percent over the year and LFL of negative 2.1 percent impacted by store closures, enforced in Europe and voluntarily in the UK, which primarily fell into November and late December.

Pepco expanded its store portfolio by over 15 percent year-on-year, opening 87 net new stores in the quarter with an expectation of opening around 300 stores in the full financial year. In addition, it upsized or relocated a further 18 stores.

Poundland, the company added, was able to trade throughout the quarter, albeit experiencing significantly reduced footfall. In the context of a volatile trading environment, the company said, trading store LFL growth of 4.3 percent is likely to have resulted in market share gains in the UK. Poundland’s revenue benefited from the continued strong performance of the Pep&Co clothing brand, which is present in 342 stores, and the continued extension of product ranges to price points above and below the 1 pounds anchor price point.

The company further said that mainland European Dealz business continues to develop positively. In the quarter, 18 Dealz stores were opened, increasing the portfolio by 19 percent versus the year-end position to 114. The company aims to open up to 70 new stores in the full financial year.

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