Poundland shares slump 10% as online shopping hits sales

British discount retailer Poundland suffered in the run-up to Christmas as consumers deserted the high street in favour of online shopping, resulting in “disappointing” sales and a downgrade of profit expectations for the year.

Shares in the group that sells everything from washing detergent to boxes of chocolates and packs of batteries, slumped more than 10% to an all-time low of 172 pence after the retailer’s third-quarter update.

Poundland, which has rapidly increased its number of shops in recent years, culminating in the buyout of rival 99p Stores last year, was one of the first retailers to warn of a volatile Christmas two months ago.

“The trading conditions that we experienced in November continued through the third quarter, with high- street customer numbers down year on year and this has impacted sales growth,” said chief executive Jim McCarthy.

The effect of Britons’ changing shopping habits, with more and more sales moving online, was felt in force on the high street this Christmas.

Marks & Spencer reported dire trading in clothing and gifts over Christmas, partly blaming unseasonably warm winter weather, while much of department stores group John Lewis’s better performance came online rather than in store.