News Column

Poundland to stretch empire with a stock market fl oatation

February 19, 2014

DISCOUNT retailer Poundland has announced plans for a stock market flotation next month which is expected to value the company at up to [pounds]750m.

The chain has seen sales rise as squeezed consumers hunt for a bargain, including well-heeled shoppers increasingly on the look- out for savings.

Since opening its first store in Burton-on-Trent in 1990, Poundland has grown to nearly 500 outlets in the UK and plans to double that number. It also operates more than 30 stores under the Dealz brand in Ireland.

Founder Steve Smith netted [pounds]50m from selling his stake in the business more than a decade ago. US private equity firm Warburg Pincus bought the group for [pounds]200m and now looks set to net a windfall as it floats for nearly four times that value.

The retailer, which sells goods such as Cadbury's chocolate and Fairy washing-up liquid for [pounds]1, will now rub shoulders with some of the City's most wellestablished names as it lists on the London Stock Exchange.

Poundland describes itself as the largest single-price value general merchandise retailer in Europe, with revenues of [pounds]880.5m in the last financial year to the end of March, and underlying earnings of [pounds]45.5m.

Revenues for the nine months to the end of December were [pounds]758.3m, and underlying earnings [pounds]45.2m.

Poundland plans to open a new 350,000 sq ft distribution centre in Harlow, Essex, later this year as it continues its growth.

There are plans to expand into Europe, with a trial of up to ten Dealz stores - which sell most products for 1.49 euros ([pounds]1.22) - targeted to open in Spain over a twoyear period, while the group said there was also potential for online sales.

Acommuter rail company is to carry on running its trains for an extra six months to bridge the gap between the end of its current contract and the start of a new to-be-bid-for mega-franchise carrying more than 280 million passengers a year.

In a deal announced by the Government, First Capital Connect (FCC) will continue its franchise until September, when a new Thameslink, Southern and Great Northern (TSGN) franchise will start.

A Which? table placed FCC 17th out of 19 train companies for passenger satisfaction, with FCC also scoring the equal-last number of points for train cleanliness.

The new deal for FCC covers services between London, Bedford, Brighton and Kings Lynn.

Starting in September, TSGN will be the largest franchise on the network and will take in the [pounds]6.5bn Thameslink improvement programme which includes new electric trains.


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Source: Northern Echo (England)


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