Blow to Poundland share prices is nothing to worry about says chief executive

Poundland has seen a drop in share prices in the aftermath of Christmas, but the chief executive has insisted that this minor setback won’t halt the rise of the discounters.
The last six months saw sales growth of the pound shop chain year-on-year of 15 percent. However, in the thirteen weeks leading up to Christmas and ending 28 December, year-on-year sales only grew by 10.2 percent.
This announcement meant that there was a drop in shares of 13.44p, down to 49.76p. Chief executive Jim McCarthy wasn’t fazed by this drop however. He said that the causal reduction of sales was due to a lower boost from new store openings.
Poundland currently has 534 stores across the UK and is on the way to opening another 60 this year.
Tesco, Sainsbury’s, Asda and Morrisons have been facing massive losses in sales growth over the last year, due largely to the growth of stores at the edges of the price spectrum, discounters like Aldi and Lidl and premium stores like Waitrose, and it is this which helped to spark off the price war.
Mr McCarthy denied that Poundland has suffered from this setback. A research director at Conlumino commented that Poundland’s “competitors are expanding, which will make the sector, which is driven on achieving high volume sales, much more challenging over the next couple of years.
“That said, Poundland is managing its costs well; it had net cash at the end of the quarter of £33.9m against £10.9m last year and intends to meet its financial expectations for the end of the year.”