Jim McCarthy

Poundland boss Jim McCarthy stopped short of confirming floation plans

Poundland CEO Jim McCarthy has described a flotation as “a natural output of success” as speculation continues to build that the discounter is to launch an initial public offering (IPO) next year.

When asked by The Grocer if Poundland was considering a flotation, although he wouldn’t confirm, McCarthy responded: “Management’s focus and role is to create the strongest possible conditions in the event or possibility [of a flotation] and we will keep on trying to drive our sales and profits forward.

“Private equity companies buy and sell businesses and then realise their value at the appropriate time so it will be no surprise to me when that happens with us.

“Flotation is usually a natural output of success for firms to move forward but you’ll find that the management teams that succeed are the ones that are purely focused on the core goals of the business and in my case that is driving the best possible value for our customers and shareholders.”

US private equity firm Warburg Pincus is the principal shareholder in Poundland with shares of 76% while management and colleagues make up the remaining 24% of shares.

Speaking after Poundland announced a 15.6% rise in underlying earnings and a record £880m in total sales for its 2012-13 results, McCarthy also confirmed plans for European expansion will be finalised within the next 18 months. He said the discounter has a choice of entering “multiple or single European markets”, and that any expansion will carry on with the brand name of Dealz, which Poundland currently uses for its Republic of Ireland business.

Furthermore, McCarthy admitted that Britiain’s biggest single-price discounter is “well advanced” in finalising its plans for an online home delivery service and has a “never say never” attitude to introducing fresh food lines into its stores in the future.