Dealz Plans 20 New Openings In Ireland In FY 2016/17
Published on Apr 19 2016 7:45 AM
Outgoing Poundland chief executive Jim McCarthy has told analysts that the retailer plans to open "around 20" new Dealz outlets in Ireland in its current financial year, out of a total of 40 net new stores across Ireland and the UK.
McCarthy said that the coming year would see the group embark on a "less exacting or demanding" development programme than in previous years, saying it is a "one year pause for breath - take the best opportunities and then go back into the normal pattern of organic growth from the following year."
McCarthy, who will step down from the role of CEO in July, to be replaced by Kevin O'Byrne, was speaking to analysts following the publication of Poundland's annual results, which indicated that sales for the 12 months ending 27 March, excluding Spain, grew by 17.9 per cent to £1,210.4 million on an actual currency basis.
However, the retailer's like-for-like sales fell by 3.9 per cent.
Poundland intends to have the conversion of the recently-acquired 99p Stores portfolio completed by the end of this month, and McCarthy told analysts that he remains "very confident of the £25 million incremental EBITDA that this deal will bring us. We expect to see about two thirds of that in the 2017 financial year."
He said that he believed the second half of the current financial year would be "much more encouraging", and see the "bedded-in benefits [of the 99p Stores conversion] start to come through in a tangible way in the like-for-likes."
Commenting on its performance, Clive Black of Shore Capital said that retail challenges challenges such as "weak high street footfall and self-improvement of the superstores", are "not going away" for the brand.
"However, the bigger opportunity for us is the capability of Poundland to operate a single fascia as a single business facing in one direction," Black added. "We are pleased to see management's initial comments on former 99p outlets albeit is early days. Whilst so, the bedding in of those additional stores should kick into improvement across the UK for Poundland; we warmly welcome the easing of the new store development pipeline for now too."
© 2016 - Checkout Magazine by Stephen Wynne-Jones