Discount retailer Pepco has said it will leave the Austrian market as it does not expect appropriate returns in the country.
The company said in a regulatory filing late on Monday, “The Group has today concluded that it will cease its operations in Austria, as it does not foresee that the Austrian market will reach the appropriate level of returns expected.”
The Warsaw-listed owner of the Pepco, Poundland and Dealz brands entered the Austrian market in September 2021. It currently operates 73 stores in the country.
Pepco had 4,832 stores at the end of December 2023, and said in October it would slow down its store opening programme to focus on rebuilding profitability.
However, it still plans to open at least 400 new stores in the financial year 2023/2024.
European Market
The group’s exit from Austria will help cash flow and underlying profitability for 2024, it said.
The group added it would enable focus on other markets where it can generate higher returns.
Pepco also said the decision does not impact its existing growth strategy in Western Europe, or impact its operations elsewhere.
The company said last month that trading conditions continue to be challenging across Europe.
Despite this, it remained “cautiously optimistic” for 2024.
