Pepco Q3 revenues jump 17.4% amid expansion plans

Pepco Group has reported its group revenues increased 17.4% year-on-year to €1.21bn (£1.02bn) for the third financial quarter ending 30 June 2022 (Q3), as sales increased 4.9%.

Pepco said its accelerated store expansion programme was the group’s single biggest driver of value creation, and the company is on track to deliver its upgraded target of 450 net new stores in FY22. 

New store openings continue across all brands with 350 new stores added so far this year, excluding the closure of 59 Fultons stores.

The performance was led by Pepco which saw Q3 FY22 revenues rise 28.5% year-on-year and 7.3% on a like-for-like basis. This was supported by a “robust performance” by the Poundland Group which saw Q3 revenues grow 3.8% year-on-year and 2% on a like-for-like basis.

Compared to pre-Covid levels in Q3 FY19, average like-for-like store sales at Pepco are +9.2% over the quarter, and Poundland’s average store sales for Q3 FY22 are up +5.6%.

Pepco said that with inflationary pressures continuing across the wider market, the group is investing in its price proposition and maintaining its discount offering. 

The company added that the discount market across Europe is now larger than at the time of the previous financial crisis in 2007-08, so a “much larger customer base is more familiar with and more frequently shops across this channel”, and Pepco remains on track for “another good year” which will meet guidance.

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.

“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.”