Pepco reports group sales up 4.9% in Q3

Poundland and Pep&Co owner Pepco has reported a 17.1% rise in third-quarter revenues, reaching a total of €1.21 billion on a constant-currency basis.

Poundland sales rose 2% on a like-for-like basis over its third quarter to 30 June 2022, with revenues up 3.8% to £429 million. Poundland sales jumped 5.6% on a comparison with three years ago before the pandemic struck.

Strong Group revenue growth was led by Pep&Co delivering +28.5% growth with a particularly strong performance in Pep&Co Hungary, Czechia and Serbia in the quarter.

New store openings continued across all brands with 350 new stores added so far this year. The company's accelerated store expansion programme was the group's "single biggest driver of value creation", with it on track to deliver an upgraded target of 450 net new stores in FY22.

With inflationary pressures continuing across the wider market, the group reaffirmed it is committed to "investing in its price proposition and maintaining its market-leading variety discount offering".

Furthermore, against this backdrop, the discount market across Europe is now much larger than at the time of the previous financial crisis in 2007-08 which means that a much larger customer base is more familiar with and more frequently shops across this channel.

Commenting on the results, Trevor Masters, CEO of Pepco Group, said: “The Group has delivered another quarter of good progress and a resilient trading performance, driven by its successful and proven strategy. We are excited about our expansion plans in Spain as they are the first step on the journey to make the best of the Group’s offering available to more customers than ever before. It means we can leverage the benefits of our broader offering across the Group, making us even more efficient and effective.

“Despite the challenging market environment, Pepco continues to accelerate and deliver against its successful growth strategy based around our four key pillars: bigger, better, simpler and cheaper. We remain confident in the strength of our customer proposition, market positioning and in our ability to drive long-term value creation.”