Poundland breaks the £1bn barrier

It is on target for a pre-tax profit of around £44 million for the last year after sales rose 11.4 per cent to £1.1 billion in the 12 months to the end of March.

Over the last quarter century it has expanded to nearly 600 stores in the UK, Ireland and now in Spain, but it's heart remains in the Black Country where it employs around 750 people at its headquarters beside the Black Country Route at Willenhall and its major distribution warehouse in Bilston.

Earlier this year it was recruiting another 100 warehouse staff at Bilston to cope with its constant expansion.

But the latest figures show Poundland's growth slowing over the last year, from 17.9 per cent at the start of the year to just seven per cent over the last three months.

Poundland says this is due to the timing of its new store openings – 60 over the last 12 months – although chief executive Jim McCarthy says trading conditions have been 'tough'. Despite that, Poundland served an average of 5.3 million shoppers a week over the last three months.

The new Spanish Dealz stores are also doing well.

The only cloud on the horizon is was last week's move the Competition & Markets Authority to flag up its concerns over Poundland's first ever takeover deal, a £55m bid to snap up the 251-strong 99p Stores chain.

The CMA says it has competition worries surrounding more than a third of the 99p Stores sites, and says it will refer the deal for a 24-week in-depth inquiry unless it receives "acceptable undertakings" from Poundland by Thursday this week. That usually means a promise to sell stores.

But chief executive Jim McCarthy won't be hurried and says he is likely to ask the CMA for more time – it could give Poundland up to three weeks to decide what it wants to do.

"I was surprised and disappointed by the announcement," said Mr McCarthy. It leaves him with three options: the long inquiry, selling off some of the stores, "or we can walk away from the deal."

"We have to decide which option is best for our customers, our colleagues, our shareholders and our supplier base.

"I hope the CMA will give us a bit more time to consider it."

Even without the 99p Stores deal, Poundland is still aiming for 1,000 stores, he said. The takeover is not vital for the company's growth plans.

"We don't have to do the 99p deal," said Mr McCarthy. "It's a good position to be in. We are going to open 60 new stores anyway this year. We only have 540 Poundland stores in the UK and we want to get that to 1,000 even without the 99p Stores.

"We are on course in Spain, and when that is successful we will turn our attention to the next market, and at some point we will transition to the web. We have lots of things going on, for the instance the launch of our Tommy Walsh DIY range in the next few weeks."