Budget retailer Pepco group has announced some major boardroom changes in order “to support accelerated transformation and focus on value creation”.
The owner of Pepco, Poundland and Dealz said non-executive chair Andy Bond has decided to step down from the role on the completion of the AGM in March after some 13 years with the group, but he’ll continue as a non-executive director.
The announcement preceded news that Poundland’s managing director in the UK, Austin Cooke, has left the discount chain shortly after ex-MD Barry Williams returned to take a seat on its board.
That news hasn’t been formally confirmed but was first reported by Retail gazette.
Cooke had become MD in autumn 2023 having moved from Pepco’s European operations. Williams is overseeing a comprehensive assessment on both Poundland and the Irish Dealz chain.
In its official announcement of its boardroom changes, Pepco added that Bond’s decision to step down comes “at a time when the core Pepco business has returned to good financial health”, although there’s no denying that the UK-based Poundland business continues to face major challenges as its latest management change highlights.
It said the board “would like to express their appreciation to Andy for his service as chair” and that he’ll be succeeded by Frederick Arnold, currently an independent non-executive director who joined the board in June 2024.
Arnold is a financial specialist with lots of experience in the UK and US and has served on the boards of a number of non-retail businesses. He began his career in banking.
Also, as part of the updated relationship agreement with the company, its majority shareholder, IBEX Topco Ltd “will have the right to recommend for nomination the chairs of the board and the remuneration committee as long as IBEX holds over 30% of the voting rights in the company’s stock”.
Pepco will in future have a smaller board with the resignation of non-executive director Maria Fernanda Mejia and executive director and CFO Neil Galloway, resulting in a board comprised of one executive director and seven non-executive directors.
It also announced the appointment of Willem Eelman as CFO. He’s “a highly experienced European CFO including 11 years with GrandVision and previous roles at C&A Europe and Unilever”.
Most of the changes will become effective as of the AGM on 12 March but Eelman joins this week, although he officially becomes CFO from the end of the upcoming AGM.
The company also said it intends to implement some “complementary governance changes to increase both the focus on and pace of value creation. These changes include creating enhanced alignment between stakeholder best interests and longer-term value creation via the introduction of multi-year equity grants as part of overall remuneration for senior leadership and non-executive directors”.
And CEO Stephan Borchert, along with Eelman and the management team will host a Capital Markets Day on 6 March, during which they’ll update on their strategic plans including “building on the momentum with the Pepco and Dealz businesses and a comprehensive assessment of Poundland and how to improve its trading performance”.
Mango announced on Monday that its UK expansion plan for this year will see six openings in London, while it will also open in the Midlands, Scotland, Northern Ireland and will debut in Cardiff in Wales.
Mango
It’s part of a wider strategic plan that the company has as it continues to expand in key markets. The UK is a major market for the brand and it ended last year with over 70 stores there, as well as its own webstore and presence on other marketplaces.
In total this year it will open 20 new stores in Britain with Daniel López, the retailer’s director of expansion and franchising, describing the UK as one of the “priority markets” for the company’s international growth.
So where exactly will it be opening new stores? There will be a new flagship on London’s Oxford Street helping to consolidate its presence on the key global shopping thoroughfare. It will have a surface area of over 1,100 sq m and will carry womenswear, menswear and kidswear.
Other major London openings will be on Long Acre in Covent Garden and on Kensington High Street.
In the Midlands, there will be a new store in Birmingham, as well as other locations, while in Scotland it will open in Glasgow, Dundee and Aberdeen. It will boost its presence in Northern Ireland with openings in Belfast and Craigavon, and as mentioned, its key Welsh opening this year will see it arriving in Cardiff for the first time.
The stores will all be designed in line with the New Med concept that has been successful for the brand with its Mediterranean inspiration.
The company has had a presence in the UK since 1999 and while it weathered some tough times several years ago, its new phase of expansion that began in 2021 appears to have been a big winner for it and a major contributor to its improving results in recent years.
Since 2021 it has opened in a number of major locations, including prime shopping streets in key cities and some of the country’s supermalls.
And as it found buoyant markets with those new openings, it ramped up the expansion programme and opened 10 UK stores in 2023 as well as more than 20 in 2024.
H&M Group is continuing the slow and steady rollout of its Arket brand with plans to open physically in Greece for the first time this year.
Arket
The Greece debut will be in the country’s capital city, Athens, although we don’t yet know the exact location nor the month in which it will open its doors.
Arket’s MD Pernilla Wohlfahrt said Athens “with its unique blend of ancient heritage and vibrant contemporary culture, provides the perfect backdrop for our modern design destination”.
Slow and steady really underlines the Swedish retail giant’s approach with Arket (as it does with the group’s Cos brand too). The first Arket store opened in London as far back as 2017 and as of this month, there are still only 39 physical stores for it across 17 countries in Europe, China, and South Korea. It also sells online in 31 markets.
That said, the pace of openings has accelerated slightly in the past year or so. Last November, the company announced it would debut in Austria with a physical store in Vienna this year and in Norway with a store in Oslo.
Earlier in the year it debuted in Poland, in Warsaw, and it also entered Spain and Italy last summer with stores in Barcelona and Milan.
It was a “disappointing” January for discretionary UK retail according to advisory firm BDO’s latest High Street Sales Tracker (HSST).
Photo: Pexels
It said in-store discretionary sales grew by 3.2%, compared to a negative base last year when total like-for-like retail sales had fallen by 0.8% and in-store sales suffered an even more significant fall with 4.2% drop. That means the latest January figures didn’t didn’t recover the losses of this time last year.
The best news in January 2025 came for online sales as they saw “significant growth”, although this was driven in part more by poor January weather than by any ultra-enthusiasm on the part of consumers.
The worst news overall was that “fashion and homewares bricks and mortar sales performed particularly poorly against negative bases”.
So, let’s look at the details. Total retail sales in discretionary spend categories grew by 7.1% in January, but “concerns remain that 2025 is set to be another difficult year for retail as rising costs continue to mount”, BDO’s HSST said.
As mentioned, online outperformed, rising 15.5% year on year while that not-good-enough 3.2% in-store increase after last January’s larger fall came as BDO said there has been “a large drop in volumes over the past two years”.
Despite plenty of big-name fashion and homewares retailers reporting a good festive season and ongoing strength in the New Year, their categories were weak overall last month.
Yes, the HSST showed their sales in-store rose 3.3% and 3.4%, respectively. But in the previous January they’d been down 6.7% and 10.1%, so it was another story of the latest increase looking good on the surface but failing by a wide margin to recover the deficit of the previous year.
BDO said January’s poor weather may have contributed to mixed footfall on the high street and driven a better result for online sales, but that the numbers were “also a continuation of the sector’s overall poor performance in 2024 and a disappointing final Golden Quarter”.
Sophie Michael, Head of Retail and Wholesale at BDO, commented: “These results may seem positive on the surface, but the underlying numbers show that the weak growth in the run up to Christmas has continued into the New Year. While many retailers may have seen a rise in sales through the release of some of the pent-up consumer spending that didn’t come through before Christmas, January trading for discretionary spend requires heavy encouragement through discounting; this delayed spending will no doubt have a significant impact on already thin margins.
“The sector has been challenged for some time by the impact of significant cost increases, which will continue to mount throughout the year, particularly post the implementation of the changes in the budget this April. Raising the thresholds for National Insurance contributions will disproportionately affect retailers, who tend to have large workforces with lower average earnings. Add in increases to the National Living Wage, business rates and the Plastic Packaging Tax all coming together and at fast pace, their thin margins will be under even more pressure.
“Retailers need to find a way to balance the increased cost of doing business while investing in product development, customer service and underlying technology, like AI, that will maintain their competitiveness. They need clear visibility on how their costs will increase to identify effective actions to mitigate the impact. This includes clarity over how their supply chain costs will rise, with many of the businesses they rely on being subject to some of the same pressures as themselves. The sector already saw a high number of job losses in 2024 and retail store closures; with the oncoming cost increases, these numbers are unlikely to ease in 2025.”
Entertainment8 years ago