Poundland like-for-likes down in first half
Poundland has reported that first half like-for-like sales dropped by 2.8% on a constant currency basis in the six months to 27 September.
The retailer said the fall reflected the head winds that it traded against during the half year, particularly as last year benefited from a late Easter, the looms jewellery band craze and favourable weather patterns in the first quarter.
Underlying pre-tax profit fell by 26.3% to £9.3 million as Poundland faced an increase in net non-underlying charges which included the costs of its Dealz trial stores in Spain and the fees associated with the acquisition of 99p Stores.
Total sales rose by 6.2% to £561.1 million.
During the period, Poundland opened 52 net new stores in the UK and Ireland.
Jim McCarthy, Poundland chief executive said: "The 99p Stores acquisition is a transformational deal for us, adding the equivalent of five years of UK organic growth and 40% to our store numbers in one go. The early sales uplifts from the first converted stores are very encouraging and we now plan to accelerate the conversion programmes so that the vast majority of 99p Stores will be converted by the end of April 2016.
"We're confident of achieving at least £25 million of incremental EBITDA from the acquisition and we are now increasing our UK & Ireland store target from 1,070 to 1,400 stores.
"The sales comparables in the second half are softer and our Christmas range is our best ever. However, we have seen highly volatile trading conditions so far in the third quarter. The quarter's performance therefore depends more than ever upon the last six weeks' trading towards Christmas."
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