Card Factory profits dented by 'lower' footfall

The greetings card specialist said statutory pre-tax profits for the year ending January 31 slipped 1.1% to £82.8m, hampered by accounting for hedging.

However, on an underlying basis, pre-tax profits were up 3.8% to £85.1m

Operating profits fell 3.7% to £85.7m, but were up 3% to £87.8m on an underlying basis.

Card Factory said total sales grew 4.3% to £398.2m across the year, but store like-for-likes inched up 0.4% as “lower” footfall impacted organic growth.

Total like-for-likes, which also include online sales, were up 0.6%.

The retailer opened 51 net new stores during the period, taking its estate to 865 at the year end.

It said it had identified a “strong pipeline of further new store opportunities” in the current financial year as it eyes a 1,200-strong portfolio of shops.

Card Factory held its EBITDA margin relatively flat at 24.7%, but said “business efficiency initiatives” were underway in order to partially mitigate margin headwinds, including foreign exchange rates and the national living wage, which will increase again next month.

Chief executive Karen Hubbard said that, having undertaken a strategic review since joining the business just over a year ago, she was “confident” that its plan would “ensure future business growth.

But she said there were “additional opportunities” within the four pillars of its strategy “to further strengthen the business for the longer term.”

Hubbard added: “Over the last year, it is that established strategy which has allowed us to deliver a good performance in a challenging retail market.

“Our store like-for-like sales remained positive and our business continued to deliver best-in-class margins whilst remaining highly cash generative.”