Poundland has announced the completion of its extensive restructuring programme, which involved the closure of nearly 150 stores and the loss of 2,200 jobs, though the discount chain admits there is still "much to do" to secure a full recovery.
Restructuring Results in Smaller Store Network and Workforce
The troubled retailer, which obtained High Court approval for its restructuring plan in August last year, confirmed it ended 2025 with 651 sites across the UK. This represents a significant reduction from approximately 800 stores prior to the reorganisation.
Concurrently, Poundland's workforce has been substantially downsized, shrinking from 14,200 employees to around 12,000 by the close of last year. The company has stated that the large-scale shop closure phase is now concluded, with any future closures expected to result from routine lease expiries typical for a retailer with an extensive property portfolio.
Mixed Trading Performance During Critical Christmas Period
Recent trading figures reveal a complex picture for the discount chain. Like-for-like underlying sales declined by 2.9% during the quarter ending December 28th, as Poundland implemented aggressive price reductions to reaffirm its discount positioning.
However, the retailer reported a 2% increase in comparable store sales by volume, suggesting customers are responding positively to lower prices. Underlying earnings showed improvement, rising by £8.4 million to reach £17.3 million in the first quarter, meeting company expectations.
Management Acknowledges Progress While Emphasising Ongoing Challenges
Poundland's managing director, Barry Williams, commented on the current situation, stating: "While there's been significant progress as we refocus and re-energise the business with lower prices and a sharper offer, we know we still have much to do."
He further elaborated: "Our focus on our costs has, without doubt, given us a platform for future growth, but no sustainable turnaround can be based on cost management alone. That's why our focus in 2026 will be on delivering the kind of ranges and price simplicity our customers want right across the store – in clothing, homewares, as well as our core grocery aisles."
Background to Poundland's Restructuring Journey
The discount retailer's dramatic transformation follows its acquisition by investment firm Gordon Brothers for just £1 in June last year. The company narrowly avoided administration when the High Court approved its restructuring plan in August, mere days before it was projected to exhaust its financial resources.
Since that critical juncture, recovery efforts have concentrated on simplifying operations through multiple strategies:
- Substantial reduction of physical stores
- Overhaul of pricing structures
- Removal of certain product categories including chilled and frozen foods
- Discontinuation of online retail operations
A central element of Poundland's renewed strategy involves returning to straightforward pricing across all UK stores, with approximately 60% of grocery items now priced at £1, alongside £2 and £3 price points throughout the grocery range.
The retailer's journey continues as it seeks to balance cost management with improved customer offerings, aiming to establish a sustainable business model for the future.
