Poundland reports 12% rise in half-year profits

<p>Poundland has seen half-year profits grow to £9.3 million.</p>

Poundland has enjoyed a successful past six months after reporting increases in half-year profits.

The discount store, which famously sells every item for £1, recorded a 12 per cent rise to £9.3 million during the first six months of the year. First-half like-for-like sales grew by 4.7 per cent, not taking into account the opening of new stores. The positive performance has been achieved despite the company being hit with significant one-off charges across the period.

Poundland paid out £1.2 million to create a new distribution centre while also supporting its launch of pilot stores in Spain. While the company already has a strong base in the UK, it has identified Europe as a key expansion market. Spain has become the first port of call with Poundland launching its subsidiary First Dealz in Madrid.

This is the first store to be opened on Spanish soil but Poundland has bold plans. At the moment there are three First Dealz stores in Spain but the company wants to take this figure to ten by the end of the 2016 financial year.

In the UK, Poundland has been expanding at a rapid pace with 28 net new stores opened across the nation, as well as Ireland, in the first half of year, taking its estate to 556 outlets. It boasts 72 retail park stores and combined with the high street shops, it will serve over five million customers.

Poundland has unveiled plans to expand its portfolio in the UK and Ireland with 60 stores penned for launch by the end of the 2015 financial year.

Darren Shapland, chairman of Poundland, said: “The strong momentum we reported in July has continued through the first half and we have made a good start to the year. Our future store opening programme is robust and I am confident in our plans for taking the Poundland and Dealz offer to even more customers in the UK and abroad.”

Find up to date information on the FTSE 100 and spread betting strategies at City Index

Join our live webinars for the latest analysis and trading ideas. Register now

GAIN Capital UK Limited (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.