Pepco Group (PCO) Q4 2024 TU earnings summary

Executive summary

• Record FY24 revenues and underlying EBITDA expected, driven by improved gross margin year-over-year.

• Profitability in the core Pepco business in Central and Eastern Europe has been rebuilt, with further improvement opportunities identified.

• Group like-for-like revenues in Q4 remained lower than the prior year, partly due to ongoing supply chain disruption.

Financial highlights

• Group revenues for the 51 weeks to 22 September 2024 are up 10% on a reported basis, driven by store expansion.

• Like-for-like revenues over the same period are down 3.1%.

• FY24 underlying EBITDA (IFRS 16) expected to be at least €900m, up ~20% from FY23 (€753m).

• Record full-year revenues expected to exceed €6 billion.

Outlook and guidance

• Focus for FY25 includes improving like-for-like sales, strengthening price leadership, and enhancing supply chain capabilities.

• Initial benefits from supply chain improvements and product transitions expected in FY25.

• Disciplined capital investment and store expansion to drive higher free cash generation and a stronger balance sheet.