Deep dive · Discount retail · Accounts to September 2025

Inside the accounts · How does Poundland make its money?

Poundland kept £31 of every £100 after paying for its goods, and spent £37 running the business

Poundland Limited sells everyday goods, clothing and homeware at simple prices from £1, in about 700 shops in the UK and, as Dealz, in Ireland. Its accounts for the 52 weeks to 28 September 2025 cover the year Pepco sold it to Gordon Brothers. They show sales down 12% to £1,549m, a gross margin that fell from 37.4% to 31.4%, running costs bigger than the gross profit, and a £252m loan written off by its old owner. Where a figure says something about how the business runs, we explain it.

CompanyPoundland Limited · 02495645

Accounts readAccounts to September 2025 PDF ↗filed 20 August 2026

ByJames Sproule · 2 November 2026

Reading time9 min read

£1.55bnRevenue, down 12%

31.4%Gross margin, from 37.4%

£120mUnderlying loss before tax; £85m after one-off items

−£90mNet liabilities, from net assets of £30m

In 60 words

The answer

Poundland makes its money on the gap between what it pays for goods and its £1, £2 and £3 prices. In 2024/25 sales fell 12% to £1,549m and that gap shrank: it kept £31.44 of every £100, against £37.36. Running costs took £37.33. Before one-off items it lost £120m before tax; Pepco writing off a £252m loan cut that to £85m.

Since the accounts, from news reports

What happened next

These accounts were signed on 12 August 2026 (p. 29) and filed at Companies House on 20 August 2026. What follows comes from news reports published on 29 October and 2 November 2026, not from the accounts, and none of its figures appear anywhere else on this page.

29 October 2026: a notice of intention to appoint administrators. Poundland filed the notice in the High Court, which gives it 10 working days of protection from creditors while it looks for a deal (Reuters, via AOL). "It is understood" that AlixPartners will be appointed (PA, via The Irish News). A notice is not an appointment: on 2 November 2026 the Companies House register still listed Poundland Limited as active, with no insolvency filing.
No buyer for the whole business. Managing director Barry Williams said: "Despite enormous efforts it has not been possible to identify an acceptable offer for the business as a whole", adding that "several established retail operators" had made formal offers for a significant part of it (Reuters; PA). Poundland said its shops remained open and trading as normal (PA).
Reported talks over the shops. Tesco held talks over buying up to 150 shops, according to sources quoted by PA; Tesco declined to comment. Fortress, which owns Poundstretcher, is reported to be interested in up to 250, and Iceland and Lidl are understood to be among grocers in the frame for some. CDS Superstores and B&M have also expressed interest in sites (PA, via The Irish News; AOL). These are reports of talks, not agreed deals.
A whole-company bid turned down. Gordon Brothers rejected an offer from Martin Property Group, which management had named as preferred bidder, reportedly partly because bidders were expected to pay £30m to cover a loan Gordon Brothers took on in its takeover (PA). The reports don't say which loan; the accounts' own facilities are in section 07.
Smaller than in the accounts. PA puts Poundland at about 600 shops, including around 70 Dealz shops in Ireland, with about 11,000 workers affected; its 29 October report said about 12,000. It also reports that Gordon Brothers bought Poundland for £1, began a sale in early September (Reuters says August) and shut more than 100 shops in the past year.

Not in the accounts. The notice, the bids and the price Gordon Brothers paid. The accounts were signed eleven weeks before the notice and describe trading in 2025/26 as "tracking in line with" the recovery plan (p. 32).

How it is paid

Buy for less than £1, sell at £1

Poundland is a shop: all its revenue "relates solely to the sale of goods" (p. 41). Its prices are anchored "on £1 in the UK or €1.50 in ROI" (p. 4), and in 2025 it went back to "simpler £1, £2 and £3 price points" (p. 1). It makes money only if it buys for well under those prices and sells enough to cover its shops.

Buying

Source abroad, pay in dollars

Most general merchandise and clothing comes from the Far East; Poundland pays some suppliers in US dollars and Chinese yuan and sells in pounds and euros (p. 4). It left Pepco's buying arm and set up its own sourcing office (p. 4).

Goods expensed £994.0m (p. 41)

Suppliers

Rebates and promotions

Brands pay volume rebates and fund promotions; both reduce what the goods cost it (p. 38). Rebates earned but not yet billed fell from £21.9m to £11.1m (p. 54).

Trade payables £126.7m (p. 54)

Shops

Rent the high street

Shops from about 2,000 to 20,000 sq ft on high streets, in shopping centres and on retail parks (p. 1). Some leases charge 1% to 3% of sales as rent (p. 60).

Lease payments £94.6m (p. 60)

Losses

Shrink and markdowns

"Stock / inventory management — shrink" is a principal risk (p. 4). In 2025 it cut "high price point but high shrink" lines (p. 1).

Stock written down £35.9m, from £28.7m (p. 41)

What this means for PoundlandFixed prices leave little room when costs rise. The company says it keeps £1 pricing profitable by changing ranges, moving supply to cheaper countries, "re-engineering pack sizes and renegotiating with suppliers" (p. 4). In 2024/25 that didn't keep up: cost of sales fell 3.5% while sales fell 11.8% (p. 27). It also settled all its currency hedges when Gordon Brothers took over, and had none at the year end (p. 4).

Not disclosed. Sales by category (groceries and household goods, general merchandise, clothing), how much supplier income it earned in the year, or how many lines it sells at each price.

The income statement

The discount retailer on one page

Revenue of £1,549m, less £1,062m of cost of sales, left £487m of gross profit, down from £656m. Running costs before one-off items were £578m, down from £665m. With £4m of other income, that is an underlying operating loss of £87m, against £2m the year before (p. 27).

Sales fell 12%; gross profit fell 26%Running costs are administration expenses, which include distribution, before one-off ('non-underlying') items.

2023/24 (restated)
2024/25

Revenue£1,549.1m

Cost of salesmostly the goods it sells£1,062.1m

Gross profit£487.0m

Running costsbefore one-off items£578.2m

Adjusted EBITDAthe company's own measure£20.8m

Income statement, p27; Adjusted EBITDA reconciliation, p3.

Out of every £100 of sales, 2024/25Running costs per £100 barely moved. The cost of sales rose by £5.92 per £100, more than the whole rise in the loss.

Loss
Costs and charges
Income and credits

Cost of sales£62.64 the year before−£68.56

Running costs£37.87 the year before−£37.33

Other incomecharges to subsidiaries£0.27

Underlying operating loss£0.13 the year before−£5.62

Income statement, p27 (our arithmetic).

Six points off the gross marginAs a share of revenue. The company blames 'an increase in product costs driven by inflationary pressures throughout our supply chain' (p2).

2023/24
2024/25

Key performance indicators, p2.

What this means for PoundlandThe cut in running costs, 13% before one-offs, roughly kept pace with sales; per £100 of sales they went from £37.87 to £37.33 (our arithmetic). The loss came from the goods. Gross margin fell "primarily due to an increase in product costs driven by inflationary pressures throughout our supply chain" (p. 2). The company's own measure, Adjusted EBITDA, fell from £115.5m to £20.8m, a 1.3% margin (p. 3). After £105.9m of depreciation and £34.7m of finance costs, mostly on leases and loans from its owners, the underlying loss before tax was £120.1m (pp. 27, 41 and 43).

Not disclosed. What the £578m of running costs is spent on beyond £308m of staff costs (p. 43) and depreciation: rent and rates, energy, distribution and head office are not split out. Staff costs come to £19.91 of every £100 of sales (our arithmetic), but the accounts don't say how much of them sits in running costs rather than cost of sales.

The finding

A £252m write-off from its old owner

Pepco wrote off what it was owed. "The loan from the previous parent company was formally waived as part of the s.26A restructure" (p. 42). That put £251.9m of income in the accounts, as "Loan cancellation", inside the operating result (p. 27). A year earlier Poundland owed its parent £207.7m (p. 29).

And wrote down its shops. £166.3m of impairments: £91.3m of goodwill, the whole of what remained from buying 99p Stores in 2015, and £75.0m on shops and their leases, tested store by store (pp. 41, 49 and 51).

Other one-offs. A £29.2m loan to a group company written off, £18.9m of restructuring and sale costs, a £12.2m loss on assets sold, and a £10.0m gain from selling "a trade name to the previous parent" (p. 42).

One-off items: £262m of credits, £227m of chargesEach bar is one step. £262m of credits, most of it the old owner's loan written off, against £227m of charges before tax and £35m of tax.

Losses
Costs and charges
Income and credits

Underlying loss before taxbefore one-off items−£120.1m

Pepco loan written offwaived in the restructuring plan£251.9m

Trade name sold to Pepcogain on sale£10.0m

Impairments£91.3m goodwill, £75.0m shops−£166.3m

Loan to a group companywritten off−£29.2m

Restructuring and sale costs−£18.9m

Loss on fixed assets sold−£12.2m

Taxmostly a tax asset written off−£35.3m

Loss for the periodstatutory−£120.5m

Income statement, p27; note 4, p42; note 10, p45.

£35.3m

Tax charge on a loss

Mostly a £36.0m deferred tax asset written off "given the recent losses incurred by the Company" (pp. 45 and 57). Another £111.3m of tax assets is not recognised (p. 57).

£0

Tax on the write-off

The loan write-off is "not allowable for tax purposes", worth £54.9m in the tax reconciliation (p. 45).

£5.2m

Subsidiaries written off

All seven subsidiaries, including Dealz Retailing Ireland Limited, are non-trading and were written down to nil (p. 52). The Irish shops trade as a branch of Poundland Limited (p. 17).

What this means for PoundlandThe statutory loss before tax, £85.2m, is smaller than the underlying one, £120.1m, because the old owner's loan write-off was bigger than all the charges (p. 27). The write-off is not cash: it removed a debt rather than bringing money in. The underlying column is the better guide to how the shops traded.

Not disclosed. The balance of the Pepco loan on the day it was waived, which group company owed the £29.2m, and which trade name was sold for £10.0m.

The estate

Fewer shops, cheaper leases

A court-approved restructuring. Shortly after Gordon Brothers bought it, Poundland proposed a Part 26A restructuring plan "with the aim of rightsizing the store portfolio", sanctioned on 26 August 2025 (p. 1). "The majority of the loss-making stores have been exited, whilst others are now operating at zero rent" (p. 1).

701 shops at the year end, from 836, and 642 by the end of January 2026 (pp. 1 and 2). It closed two distribution centres, Darton and Springvale, its online shop and its Poundland Perks loyalty scheme, and stopped selling frozen food (p. 1).

Leases shrank. Lease liabilities fell from £313.0m to £204.9m, and £166.1m of leased assets at cost were disposed of (pp. 59 and 60).

194 fewer shops in 16 monthsShops open at each date. January 2026 is after the year end, as reported in the strategic report.

Shops

Key performance indicators, p2; strategic report, p1.

£94.6m

of cash went on leases in the year, from £98.4m. Interest on lease liabilities was £17.8m, at an average borrowing rate of 6.46% (p. 60).

£277.5m

of lease payments still to come at the year end, undiscounted, £50.1m of it within a year (p. 55).

Where the £1,549m was takenUK sales fell 12.9% to £1,410m; Irish sales rose 1.4% to £138m (our arithmetic).

91.0%

UK · 91.0%
Republic of Ireland (Dealz) · 8.9%
Isle of Man · 0.1%

Note 2, p41.

What this means for PoundlandA restructuring plan lets a company change what it owes to creditors, including landlords, if the court approves. Poundland's plan has a cost still to come: "certain creditors are eligible to additional payments as a share of upside trading performance based on the EBITDA achieved over the period FY26 to FY28" (p. 64). No provision has been made because it is "not possible to estimate" (p. 64).

Not disclosed. Which creditors the plan covered, how much rent it cut, how many shops pay no rent, or the EBITDA threshold above which creditors share in profits.

Ownership and borrowing

Owned and lent to by Gordon Brothers and Pepco

Two owners. Pepco Group began a sale in March 2025 and Gordon Brothers Holdings, a US company, completed the purchase on 12 June 2025 (p. 1). Since 29 August 2025 the UK holding company, 1903 Peach Bidco Limited, has been 70% owned by Gordon Brothers and 30% by Pepco (p. 55).

Lent to by both. A £95m asset-based loan from Gordon Brothers, secured mainly on stock, had £50.0m drawn at SONIA plus 7.5%. A £30m Pepco facility was fully drawn at 6.5%. A £30m overdraft was undrawn, and after the year end was replaced by a Gordon Brothers term loan to 29 August 2027 (p. 55).

Net liabilities of £90.2m. Total assets halved to £451.9m, against £542.1m of liabilities (p. 29).

£155m of facilities from its two owners, £80m drawnAll the borrowing is from Gordon Brothers and Pepco. The overdraft was undrawn at the year end.

Facility
Drawn at 28 September 2025

Asset-based loan, Gordon Brothersto August 2028, SONIA + 7.5%£50m

Facility, Pepcoto September 2030, 6.5%£30m

Overdraft, now a Gordon Brothers term loanterm loan to 29 August 2027£0m

Note 17, p55; directors' report, p18.

Half the balance sheet gone in a yearTotal assets fell from £948m to £452m. Net assets of £30m became net liabilities of £90m.

29 September 2024 (restated)
28 September 2025

Shops, fittings and leasesincluding leased shops£196.5m

Goodwill and software99p Stores goodwill written off£1.8m

Stock£164.9m

Cash£30.6m

Owed to suppliers and otherstrade and other payables£255.3m

Lease liabilities£204.9m

Loans from ownersPepco, then Gordon Brothers and Pepco£78.1m

Statement of financial position, p29.

£0

Dividends

None proposed, and none paid the year before (p. 43).

£4m

Pepco guarantee

Pepco still guarantees a letter of credit with the bank, for no fee (p. 55).

£648k

Services to Dealz Poland

Transition services to Pepco companies after 29 August 2025: £647,967 to Dealz Poland and £54,446 to Pepco Group Services (p. 64).

What this means for PoundlandWith the Pepco loan gone, Poundland owed its lenders £78.1m at the year end, against £207.7m a year earlier, plus £204.9m of leases (pp. 29 and 55). Every lender is also an owner. Cash fell from £46.7m to £30.6m (p. 29). It owed suppliers less: trade payables fell from £156.3m to £126.7m (p. 54), and the company says it kept the same payment terms with suppliers after leaving Pepco's buying arm (p. 4).

Not disclosed. A cash flow statement: Poundland uses an exemption because its parent publishes group accounts (p. 31). The accounts also don't give the price Gordon Brothers paid, or transactions with group companies before 29 August 2025 (p. 64).

Staff and pay

14,417 people and £308m of pay

£308m of staff costs, down 2%, with 11% fewer people£21,388 per average employee, up from £19,368 (our arithmetic).

2023/24
2024/25

Wages and salaries£278.4m

Employer National Insuranceup 27%£25.3m

Pensionsdefined contribution£4.7m

Note 8, p43.

Who the 14,417 people areAverage employed in 2024/25. Each square is 1%.

Shops and distribution: 13,920
Administration: 497

Note 8, p43.

Fewer people, more per head. The average workforce fell 11% to 14,417; staff costs fell 2% to £308.4m (p. 43). Per head that is £21,388, up from £19,368 (our arithmetic).

National Insurance up 27%. Employer's social security costs rose from £20.0m to £25.3m (p. 43). The company lists the National Living Wage and employer NI changes among its risks (p. 4).

Directors. £2.13m in all, including £503,000 of bonuses and £202,000 for loss of office. The highest-paid director, not named, received £628,000 including a £260,000 bonus (p. 44).

What this means for PoundlandAlmost everyone works in shops or distribution: 13,920 of 14,417 (p. 43). "This year the Company prioritised survival", which "meant that a number of colleagues had to leave" (p. 14). Central headcount and spending on goods not for resale were cut by 20% (p. 1). Staff are represented by the union Usdaw (p. 19).

Not disclosed. How many jobs went in the restructuring, redundancy costs on their own, or headcount at the year end rather than the average.

In the directors' words

Going concern: a £30m loan to replace

What the accounts said was comingQuarters from March 2025. The asset-based loan runs to August 2028 and the Pepco facility to September 2030, beyond the right-hand edge.

In the year
After the year end
Due dates

Mar 25Jun 25Sep 25Dec 25Mar 26Jun 26Sep 26Dec 26Mar 27Jun 27Sep 27Dec 27

Sale process

Mar

Sold to Gordon Brothers

12 Jun

Restructuring plan

26 Aug

Year end

28 Sep

Accounts signed

12 Aug

Refinancing to start

early 2027

Term loan ends

29 Aug

Going-concern period

to end FY27

Strategic report p1; note 1.2 p32; note 17 p55; balance sheet p29.

There is therefore a risk that the Company will not have sufficient financial resources beyond 29 August 2027 and therefore there exists a material uncertainty that may cast doubt over the ability of the Company to continue as a going concern beyond that date.
Note 1.2, going concern, p. 32

In the scenario where funding is not raised, the available cash reserves may be exhausted at that time.
Note 1.2, going concern, p. 32

Performance during FY26 is tracking in line with this plan with further actions expected to continue to show benefits into FY27 and beyond.
Note 1.2, going concern, p. 32

In plain termsThe directors expected the business to trade within its facilities to the end of September 2027. It would take "a 10% sales miss or 2.3% margin deterioration" before more money was needed (p. 32). The risk they named was the £30m Gordon Brothers term loan ending on 29 August 2027, with a refinancing to start "in the early part of 2027" (p. 32). The auditor, Forvis Mazars, drew attention to the same material uncertainty; its opinion is not modified (p. 23).

Not disclosed. The forecast cash at its lowest point, the headroom on the asset-based loan, or any covenants on the facilities.

Two years side by side

Year on year

2024/25 against 2023/24Percentage change, one scale. Profit is left off: the pre-tax loss went from £45m to £85m, and the underlying loss from £30m to £120m.

Revenue£1,757m → £1,549m-12%

Gross profit£656m → £487m-26%

Underlying running costs£665m → £578m-13%

Adjusted EBITDA£115.5m → £20.8m-82%

Shops836 → 701-16%

Average employees16,214 → 14,417-11%

Staff costs£314m → £308m-2%

Stock£230m → £165m-28%

Cash£46.7m → £30.6m-34%

Income statement p27, KPIs p2, reconciliation p3, balance sheet p29, note 8 p43.

Restated. The 2023/24 figures were corrected for five errors: £61.1m of sales between the UK business and its Irish and Manx branches that had been counted as revenue, £23.6m of old supplier balances that could not be recovered, £10.9m of fixed assets that "no longer existed or could not be substantiated", lease accounting errors found in due diligence before the sale, and a £34.9m goodwill write-down that was not needed. As first reported, 2023/24 revenue was £1,818m and the pre-tax loss £79.2m (pp. 61 to 64).

Show the figures as a table

Measure	2024/25	2023/24 (restated)
Revenue	£1,549m	£1,757m
UK revenue	£1,410m	£1,620m
Republic of Ireland revenue	£138m	£136m
Gross profit	£487m	£656m
Gross margin	31.4%	37.4%
Running costs before one-offs	£578m	£665m
Adjusted EBITDA	£20.8m	£115.5m
Underlying loss before tax	−£120.1m	−£30.0m
One-off items (net)	£34.9m	−£15.4m
Loss before tax	−£85.2m	−£45.4m
Loss for the period	−£120.5m	−£57.0m
Shops at the year end	701	836
Average employees	14,417	16,214
Staff costs	£308m	£314m
Stock	£165m	£230m
Cash at the year end	£30.6m	£46.7m
Loans from owners	£78.1m	£207.7m
Lease liabilities	£204.9m	£313.0m
Net (liabilities)/assets	−£90.2m	£29.9m
Dividends	£0	£0

Adjusted EBITDA is as the company reconciles it (p. 3). That reconciliation adds back £40.4m of depreciation on owned assets; notes 3 and 11 give £40.9m (pp. 41 and 47). With the notes' figure, Adjusted EBITDA would be £21.3m (our arithmetic).

Quick answers

Questions about Poundland

How does Poundland make its money?

Was Poundland profitable?

No. In the 52 weeks to 28 September 2025 it made a loss before tax of £85.2m and a loss after tax of £120.5m. Before one-off items the loss before tax was £120.1m; the biggest one-off was a £251.9m gain when its former owner Pepco waived a loan, against £166.3m of impairments.

Who owns Poundland?

Gordon Brothers Holdings, a US company, bought Poundland from Pepco Group on 12 June 2025. Since 29 August 2025 its UK holding company, 1903 Peach Bidco Limited, has been 70% owned by Gordon Brothers and 30% by Pepco. The accounts don't give the price.

How many shops does Poundland have?

701 at 28 September 2025, down from 836 a year earlier, and 642 at the end of January 2026, according to its accounts. News reports in October 2026 put the number at about 600, including around 70 Dealz shops in Ireland.

Is Poundland in administration?

On 29 October 2026, according to news reports, Poundland filed a notice of intention to appoint administrators, which gives it 10 working days of protection from creditors. A notice is not an appointment: on 2 November 2026 Companies House still listed Poundland Limited as active. Its accounts, signed in August 2026, carried a going-concern warning about replacing a £30m loan due in August 2027.

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