Tuesday 16 April 2019 7:39 am

Card Factory sales flat as high street footfall drops

Jess Clark is a City A.M. news reporter covering private equity and investment.

Jess Clark is a City A.M. news reporter covering private equity and investment.

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Card Factory saw sales remain flat last year as high street footfall levels dropped, the greetings card company announced this morning.

The figures

Card Factory’s like-for-like sales dipped 0.1 per cent while overall revenue rose 3.3 per cent to £436m in the year to the end of January 2019.

Underlying earnings fell 4.9 per cent to £89.4m and underlying profit before tax dropped 8.3 per cent to £66.6m the previous year.

Underlying earnings per share were 17.6p, down from 18.9p in 2017 and the company announced that the total dividend per share was maintained at 9.3p.

Why it's important 

Sales in Card Factory's high street stores were impacted by a decrease in footfall, however the company's online sales increased by 56.3 per cent, as the brand attracted new customers and introduced products that were unavailable in stores. 

However, the company's other online arm, Getting Personal – which offers personalised cards and gifts- saw revenue fall by 8.4 per cent. 

Card Factory opened 51 new stores in the year and has a pipeline of around 50 planned openings in the year ahead, with a focus on retail park locations, as it targets increasing its 965 stores to 1,200 in the long-term. 

The company has introduced a half-yearly store review to consider plans to upsize, downsize or relocate each shop. 

What the Card Factory said

Card Factory chief executive Karen Hubbard said: “New stores remain our biggest growth channel, and we opened a net 51 in the year, with a good pipeline going forward. We are now also exploring other opportunities to extend our reach beyond 1,200 stores in the UK and internationally to drive profitable growth.

"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.

“As previously stated, EBITDA for the forthcoming year is anticipated to be broadly flat year-on-year in light of various external pressures, but we are confident we are laying the right foundations for future profit growth, whilst continuing to deliver healthy returns of cash to our shareholders.”