Post lockdown sales recovery at Card Factory

Cards and gifts retailer, Card Factory, says trading for the FY22 period was ahead of its Board’s expectations, with performance recovering from April 2021 as Covid-related restrictions eased.

In an update for the 11 months ended 31 December 2021, the business says restrictions resulted in the full closure of its store estate for about 20% of the available trading days in the period – compared to approximately 40% in FY21.

The Wakefield-headquartered company’s stores were closed from the start of the period on 1 February 2021 with a partial re-opening from 12 April 2021, and the entire estate trading from 17 May 2021.

From April, Card Factory says like-for-like (LFL) store sales and transaction volumes showed an overall upward trend towards pre-Covid-2019 levels during the year as consumer confidence returned with the Group’s stores outperforming high street averages.

Trading recovered particularly strongly through December, with LFL store sales in the run up to Christmas returning to similar levels to those delivered in December 2019.

Total sales of £337.3m were ahead of the Board’s expectations, yet below the £424.5m for the pre-Covid 11 months to 31 December 2019.

Store sales of £310m, represented a LFL decline of 5.4% on a two-year basis, and a decline of 0.8% compared to the prior year.

Meanwhile, online sales increased 23.3% on a two year basis to £22.2m, of which revenue increased 130.3% and revenue declined 11.4% following the decision to focus on  higher margin sales.

And strong cash generation during the period, resulted in a significant reduction to net debt to £60m (excluding lease liabilities of £130.1m) at 31 December 2021, compared to £87m (excluding lease liabilities of £148.0m) at 31 December 2020.