Poundland has announced that its sweeping restructuring, which involved the closure of nearly 150 shops and the loss of 2,200 jobs, is now complete. However, the discount retailer acknowledged that it still has 'much to do' to return to full health.
The company, which secured High Court approval for its restructuring plan last August, ended the year with 651 sites, down from around 800 before the reorganisation. Its workforce shrank from 14,200 to approximately 12,000, and two of its four warehouses were closed, in Darton, South Yorkshire, and Springvale in Bilston, West Midlands, alongside a reorganisation at its customer service centre in Walsall.
In a trading update on Friday, Poundland confirmed that large-scale store closures are over, with any future closures resulting from standard lease events. The retailer reported a 2.9% drop in like-for-like underlying sales in the quarter to December 28, as it slashed prices to return to its discount roots. However, comparable store sales by volume rose 2%.
Underlying earnings in the first quarter rose by £8.4 million to £17.3 million, in line with expectations. Managing director Barry Williams said: 'While there’s been significant progress as we refocus and re-energise the business with lower prices and a sharper offer, we know we still have much to do.'
Poundland was sold for £1 to investment firm Gordon Brothers in June last year, avoiding administration after a restructuring plan was approved in the High Court in August. The recovery efforts have focused on simplifying the business, including cutting stores, overhauling pricing, and removing categories such as frozen foods and some chilled ranges, as well as ditching its online offering.
The retailer is returning to a simple £1, £2 and £3 grocery pricing across all its UK shops, with around 60% of grocery items priced at £1. It is also relaunching its in-house Pep&Co clothing range, with 90% of items priced below £10, and launching a nationwide advertising campaign next week.
