LONDON (Reuters) – European discount retailer Pepco Group reported a 22.8% surge in first-half revenue, driven by strong demand for its value offers from cash-strapped shoppers and the opening of 166 new stores.
The Warsaw-listed group said revenue was 2.84 billion euros ($3.11 billion) for the six months to March 31. Like-for-like sales were up 11.1% in the first half and up 8.5% in the second quarter.
The owner of the Pepco, Poundland and Dealz brands said it remained on track to deliver full-year core earnings growth in the “mid-teens”.
European consumers have been pressured for more than a year by high inflation that has outstripped pay growth.
In economic downturns, discount operators tend to do relatively better than mainstream peers, as they have lower cost bases and shoppers become more price sensitive.
“The macro environment the group faces is more balanced now than in the past 18 months with product input costs starting to ease, though headwinds remain on other costs, including energy,” Pepco said, noting an improving margin outlook in the second half.
($1 = 0.9125 euros)
(Reporting by James Davey; Editing by Christian Schmollinger and Rashmi Aich)
