Rise of the discounters continues as Poundland enjoys a record Christmas
WEST Midlands-based discount retailer Poundland has reported record trading over the Christmas period when seven million shoppers visited its stores in one week.
Following the success of discount supermarket chains such as Lidl and Atherstone-headquartered Aldi, Poundland has seen a surge in demand for its single-price products from High Street bargain hunters.
In its third quarter trading statement for the 13 week period to December 28, the Willenhall-based firm reported total revenue, excluding Spain, increased by 10.2% on a constant currency basis.
On an actual currency basis, total revenue, excluding Spain, was £328.4m (2013: £299.1 million), which represented total growth of 9.8%.
There was a good contribution to growth from both like-for-like store sales and continuing good performance from new stores during the third quarter.
Poundland said that, due to the timing of its openings, the contribution from new store trading weeks was lower than the corresponding period last year, a continuation of the trend seen in the first half.
The retailer said that it remains on track to open 60 net new stores in the UK and Ireland in the financial year.
It opened a net 17 stores in the UK and in Ireland during the period in question, taking the total to a net 45 during this financial year to date.
Poundland ended the third quarter with 534 stores in the UK and 39 stores in Ireland (2013: 486 and 31 respectively) and says it has a strong pipeline of stores for its next financial year.
It has continued to develop its trial in Spain and says it is pleased with the initial progress it has made. It opened four stores during the period, taking the total to five at the end of the quarter.
Poundland generated strong cash flow during the period and ended the quarter with net cash of £33.9m (2013: £10.9m).
Chief executive Jim McCarthy said: “I am pleased to report another good quarter of sales growth and a record Christmas trading period. Despite the tough trading conditions, Poundland continued to perform well and we served more than seven million shoppers in the peak Christmas trading week alone.
“We have managed our costs and cash well, and we are in line with our financial expectations for the year as a whole. We are on track to open 60 net new stores in the UK and Ireland and we have a very strong pipeline for our 2016 financial year.”
