‘Robust’ performance as Card Factory bucks high street trends

Card Factory has praised a “robust” performance, while admitting difficult trading conditions in this morning’s final year results.

Revenues for the retailer increased in the year to 31 January 2019, from £422.1m to £436m and it is looking to open even more stores, aiming for 1,200. However pre-tax profits have dipped slightly. Yearly pre-tax profits reached £66.6m, down from £72.6m in the same period the year before.

The Wakefield-based card retailer said this trend-bucking performance was down to a growth in market share in the “stable” card market, as well as strong seasonal and non-card performance.

It said that 51 net new stores opened in the period, and it had a “strong pipeline” of store opportunities in 2019, despite admitting “widespread high street footfall decline” which has affected other retailers, recently Monsoon, Accessorize, Debenhams and House of Fraser.

The company is looking at both home and abroad for expansion opportunities, growing its store portfolio in the Republic of Ireland and Jersey, as well as looking at the potential of Australian partnerships. It also said that 50% of Card Factory customers do not know about their online offering, which could be another venue to “exploit”.

Its online Getting Personal brand showed disappointing results, as the company focuses on an improved digital approach.

As a whole, the company is approaching 10,000 staff across headquarters and 972 stores.

Karen Hubbard, chief executive officer, commented: “We delivered a robust performance for the year, maintaining flat like-for-like sales despite a tough consumer environment. Our focus has been on continual improvements to our customer offer, producing better, more innovative ranges of everyday and seasonal cards and maintaining our quality and value positioning, while also being more efficient and driving savings across the business. EBITDA for the year however, was impacted by lower footfall and Getting Personal’s disappointing performance.

“Encouragingly, some initial trials with Aldi in the UK, in an Australian retailer, and with a franchise partner in Jersey show that the Card Factory brand is a footfall driver that has real resonance; we will pursue these types of opportunities to open new routes to market where we see attractive returns.

“Whilst the new financial year is just two months old, we are satisfied with the start we have made and are particularly pleased with record seasonal performances from Valentine’s Day and Mother’s Day.”

The company declared a total ordinary dividend per share,of 9.3p, the same as in 2018. A special dividend of 5.0p per share was paid in December 2018 (FY18: 15.0p).

It is also celebrating the fifth year since its IPO this year.