GDANSK, Poland, Jan 15 (Reuters) - European discount retailer Pepco Group reported a 4.3% rise in first-quarter revenue to 1.4 billion euros ($1.6 billion) on Thursday, as solid growth at its core budget brand offset a weaker performance at its Dealz chain.
Like-for-like revenue for the Pepco brand rose by 3.3%, while smaller Dealz, which the group is planning to sell, saw a 7.7% decline in the three months to the end of December. Group growth was also driven by newly opened stores.
The group, which opened 51 net new stores in the quarter to bring its total to 4,410, confirmed its full-year guidance and said it continues the process to divest Dealz, intended for completion in 2026.
The company's model of selling clothing and household items at low prices sets it up for heavy competition with rivals such as LPP's Sinsay and AB Foods' Primark, as retailers vie for shoppers grappling with high living costs.
"Consumer confidence in some markets remains subdued against an ongoing uncertain macroeconomic backdrop, but our focus ... is resonating with customers who continue to prioritise value in their everyday shopping decisions," Pepco CEO Stephan Borchert said in a statement.
($1 = 0.8595 euros)
(Reporting by Marta Maciag, editing by Milla Nissi-Prussak)
