Steinhoff shares rise on Pepco's double-digit growth
DURBAN – Steinhoff International rose more than 22 percent on the JSE in early trade yesterday after the troubled retailer’s subsidiary, Pepco Group, reported a double-digit growth in revenue for the quarter to end December, boosted by new store openings in Pepco and Dealz.
But the momentum lost its steam later in the day as the stock eventually settled to close at a marginal 1.89 percent up at R1.62.
Pepco Group owns the Pepco and Dealz brands in Europe.
Pepco Group reported a 13.3 percent increase in revenue to €1.14 billion (R18.63bn) for the quarter and was up by 6.6 percent on a like-for-like basis. The group said revenue growth was driven both by the ongoing expansion of the group’s Pepco and Dealz formats in Europe.
Pepco Group chief executive Andy Bond said the group had continued to deliver operational and strategic progress, reflecting their clear growth strategy, centred on the significant long-term opportunity for further Pepco stores in central Europe, together with a focus on day-to-day retail execution.
“This combination has secured another quarter of strong revenue growth, both in total and like-for-like terms, in each of the group’s brands. With an established strategy, leading customer proposition within a structurally advantaged discount retail segment and a strong financial base, we remain confident about our prospects for continued growth across Europe in the balance of the financial year and beyond,” Bond said.
Pepco expanded its store portfolio by more than 20 percent year-on-year by opening 94 net new stores. It upsized or relocated a further 23 stores during the quarter.
The group is planning to open around 300 Pepco stores in the full financial year. At the end of the quarter, the group’s portfolio consisted of 2 809 stores, an increase of 14.8 percent in a year.