“Challenging” environment puts brakes on Card Factory growth

CARD FACTORY chief executive Karen Hubbard has warned that a challenging six months will impact the growth of Card Factory this year.

The Wakefield-based business reported sales growth of 4.8% for the half of the year to 31 July, down from 8% growth in the last period.

It said that first quarter sales growth was “softer than levels recently achieved with variability in retail footfall impacting weekly sales patterns.”

It opened 34 net new stores, down from 36, but said it was on track to deliver 50 new net stores this full year.

The company had a record year last year with revenues up to £381.6m and pre-tax profits up 96% up to £83.7m.

Karen Hubbard, Card Factory’s chief Executive Officer, said: “As highlighted in our Q1 announcement, the retail environment in the first half has been challenging and, as widely reported, footfall patterns in the first half have generally been soft. Card Factory is not immune to these wider factors and our sales growth over the period was lower than our normal levels as a result.

“It is too early to assess the precise impact on overall consumer sentiment and retail footfall from the result of the EU referendum. However, we enter the second half with confidence in the quality and value of our offer, including our new Christmas range, and we will target improved sales growth in the second half.

“Despite the near term challenges, Card Factory remains the clear market leader in the robust and resilient greetings card market with a strong value proposition, a unique vertically integrated operating model, significant scale advantages, superior margin structure and a strong management team.

“We remain as convinced as ever of the strong growth prospects for the business, and of our ability to deliver strong shareholder returns over the medium term. We are confident of delivering full year underlying profit before tax within the range of analysts’ current expectations.”