UK: Pepco Group Core Earnings Rise 46%, Boosted By New Store Openings
Discount Retail Chain Pepco Group (owned by Steinhoff International and listed ), which operates the PEPCO, Poundland and Dealz discount retailer brands in Europe, has reported a 46% jump in its 2020/21 core profit, reflecting new store openings amid the easing of lockdown restrictions.
The group said its underlying earnings before interest, tax, depreciation and amortisation (EBITDA) came in at €647 million (US$ 776 million) in the year ended September 30, in line with its forecast range of €640 million (US$ 768 million) to €655 million (US$ 786million).
The group had previously anticipated full-year profit to be at the upper end of expectations.
Pepco, which listed on the Warsaw stock market in May with a valuation of €5 billion (US$ 6 Bn), said revenue increased on a constant currency basis by 19.3% to €4.12 billion (US$ 5 Bn), with like-for-like sales up 6.5%.
The company saw 483 store openings, including the first PEPCO stores in Austria, Serbia and Spain, taking the total to 3,504. The group said it has a strong new stores' pipeline for 2021-22 and beyond, while it also plans to boost its workforce.
Plans To Open In Germany
"The highly encouraging initial performance of these Western European PEPCO stores gives us increasing confidence that the whole of Europe is an addressable market for us, with our plans to open in Germany well on track for the first half of 2022," chief executive Andy Bond said.
"Through our new stores we remain on course to create at least 13,000 jobs over the next three years."
The group said it continued to face commodity inflation and increased shipping costs alongside supply chain disruption at the start of its new financial year. However, it said it has a clear strategy to mitigate the impact. It also said that it is monitoring the emerging new wave of Omicron variant across Europe that has resulted in the re-introduction of government-mandated restrictions in some of its operating territories. "Based on our understanding of the current level of COVID impact on revenue and costs, we are confident in delivering full-year profit growth in line with historic levels," the company said.
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