Discount retailer Pepco Group has today posted record-high third-quarter revenue and announced a share buyback programme of up to €50m, as it reported its first results after the sale of Poundland.
The Warsaw-listed company said its revenue rose 7.7% year-on-year at constant currency to €1.1 billion in the third quarter that ended on June 30, with like-for-like sales growing 2.6% driven by growth in both the Pepco and Dealz brands.
“Our results in Q3 reflect our continued strategic execution across the New Pepco Group and actions we have taken to drive more consistent performance,” CEO Stephan Borchert said in the press release.
Investment firm Gordon Brothers bought the struggling Poundland business from Pepco in June for a nominal value.
Pepco, which had been weighing its options for the 800-store British discount retailer since December, said at the time the sale was in line with its strategic plan to move away from fast-moving consumer goods.
Poundland’s business, heavily reliant on low-margin fast-moving consumer goods, had been a significant drag on the group’s overall profitability.
The divestment allows Pepco to focus on its main brand, which sells higher-margin clothing and general merchandise mainly in Central and Eastern Europe.
Pepco said it would launch the buyback programme, aimed at reducing its capital and meeting obligations under equity incentive plans, on or around July 17.
The maximum price to be paid for the share repurchases is 110% of the market price of the ordinary shares, Pepco said, adding the current share price undervalues the group’s future prospects.
