Poundland has secured High Court approval for a restructuring scheme that unlocks up to £60 million of new funding and steers the discount retailer away from administration.

Mr Justice Sir Alastair Norris sanctioned the plan on Tuesday, four days before the company was expected to run out of cash on 7 September. “I am going to sanction the plan. I will give my reasons later,” he said during the brief hearing.

Barrister Tom Smith KC, acting for Poundland, told the court the business had “significantly deteriorated during the last two years” and had “performed poorly in a difficult retail and economic environment”. Without approval, directors would have placed the chain into administration by the end of the week, he added.

Poundland employs about 14,700 staff across roughly 800 stores. The company was bought in June for £1 by Peach Bidco, a subsidiary of investment firm Gordon Brothers, from Poland-listed Pepco Group. The latest scheme releases £60 million in fresh capital, on top of the £30 million injected at the time of purchase, taking Gordon Brothers’ total commitment to £90 million.

Under the court-approved plan, Poundland will receive a £30 million overdraft facility and extended loan maturities to 2028. The scheme also allows the firm to negotiate lower rents on certain sites.

Cost-saving measures remain central to the turnaround. The retailer has confirmed the closure of 68 stores, a move affecting about 1,000 roles. It will also shut its frozen and digital distribution site in Darton, South Yorkshire, later this year and another warehouse in Bilston, West Midlands, early next year. Online sales through Poundland.co.uk will cease next month, and the company’s Perks app will be retired.

Managing director Barry Williams said the decision “allows us to stabilise the business, securing the future of hundreds of stores and thousands of jobs”. He added that management would now focus on “revamping ranges, lowering prices and creating the simpler and more focused Poundland we know our customers are eager for us to deliver”.

Poundland reported a pre-tax loss of £35.7 million in its most recent financial year. Rising wage bills and national insurance contributions have added pressure to margins, while recent efforts to expand into chilled and frozen products increased operating costs.

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