The low-cost European retailer Pepco Group declared on Thursday that it remains confident in its ability to deliver annual results in line with the forecasts set in December, despite uncertain geopolitical and consumption contexts.
The conflict in the Middle East had a minimal impact on the company, according to Pepco, adding that it was well positioned to handle the evolving situation.
“So far, we are seeing a stable situation, especially within our supply chain,” said CEO Stephan Borchert to Reuters, adding that the company is confident in the resilience of its economic model and is planning for the future without anticipating major disruptions.
The company’s stock was up 3.1% at 3:20 PM GMT.
Pepco highlighted its structurally lower exposure to short-term demand volatility and fast-fashion cycles. The company is also well positioned to attract middle-class consumers looking for more affordable products, emphasized Mr. Borchert.
The discounter plans to add approximately 250 stores to its network this year, with openings spread across various markets, focusing on Central and Eastern Europe. Mr. Borchert also noted that planned openings in Western Europe had more than doubled.
Mr. Borchert also stated that sales in the Iberian Peninsula and Western Europe had exceeded the group’s expectations, reinforcing confidence in the region’s future growth potential.
Additionally, the company will continue its expansion in Central and Eastern Europe by entering the North Macedonian market in June, expanding the Pepco brand presence to a total of 19 countries.
This refocus on mainland Europe follows the company’s sale of its struggling British Poundland operations in June.
For the 25 weeks ended on March 22, nearly the first six months of the fiscal year starting in October, the group’s revenue increased by 3.7% at constant exchange rates.
Pepco indicated that the process of selling Dealz is progressing well and is expected to be completed during the current financial year, while the company continues to develop its own brand in Europe.
