By James Davey
LONDON (Reuters) -European discount retailer Pepco Group reported a 22.8% surge in first-half revenue, as its low prices chimed with cash-strapped consumers and it opened a net 166 new stores.
The Warsaw-listed group said on Thursday revenue was 2.84 billion euros ($3.11 billion) for the six months to March 31. Like-for-like sales were up 11.1% in the first half and up 8.5% in the second quarter.
The owner of the Pepco, Poundland and Dealz brands said it remained on track to deliver full-year core earnings growth in the "mid-teens".
European consumers have been pressured for more than a year by high inflation that has outstripped pay growth.
In economic downturns, discount operators tend to do relatively better than mainstream peers, as they have lower cost bases and shoppers become more price sensitive.
In food retailing, Aldi and Lidl are currently Britain's fastest growing operators, while in air travel Ryanair is outperforming rivals.
"Our strategy of price leadership gives us continued conviction in our ability to win customers and market share, which we have grown in our key markets over the last quarter," Pepco CEO Trevor Masters said.
The group currently trades from 4,127 stores in 19 territories across Europe.
Over the full year it plans to open at least 550 net new stores, including the launch of the Pepco brand in Portugal and Bosnia and Herzegovina in the second half.
"The macro environment the group faces is more balanced now than in the past 18 months with product input costs starting to ease, though headwinds remain on other costs, including energy," Pepco said, noting an improving margin outlook in the second half.
Pepco shares were little changed at 40 zlotys in early trading, giving it a market value of 22.9 billion zlotys or 4.92 billion euros.
(1 euro = $1.0965)