POUNDLAND is eyeing a possible initial public offering (IPO) in the first half of next year as the private equity owners of the discount retailer look to cash in on its surging sales.
The chain, which has benefitted from thrifty shoppers seeking value during the economic downturn, posted a 15 per rise in sales to £880m yesterday for the year to 31 March.
Underlying earnings before interest, tax, depreciation and amortisation rose 15.6 per cent to £45.4m, with the retailer now serving 4.5m customers a week.
“Poundland has emerged with universal appeal across the market place. A feature of today’s consumer is that they are all seeking value,” chief executive Jim McCarthy told City A.M.
He refused to be drawn on the details of potential float, except to say “it will be no surprise to me when that happens”.
US private equity firm Warburg Pincus bought Poundland three years ago for £200m. It is thought that an IPO could value the chain at up to £600m.
A final decision has not been made but it is thought Warburg is close to hiring banks to work on the float.
Poundland, which hired former Tesco finance boss Andrew Higginson as non-executive chairman last year, has ambitions to more than double the number of UK shops to 1,000 over the next decade.
It also plans to move into mainland Europe in the next 18 months under the Dealz brand, which it operates in the Republic of Ireland.
McCarthy said Poundland’s rapid growth in Ireland gave the firm confidence that it would enjoy similar success on the continent.