Card Factory swings back to black as consumers return to high street

The card specialist retailer recorded profit before tax of £14.3m in the six months to July 31, up from a loss of £6.5m a year previously.

This included £3.5m in one-off benefits released from its previous financing facility after the business secured refinancing to provide liquidity headroom going forward.

Revenues grew 4.1% on a like-for-like basis over the same period as customers flocked back to its high street stores.

Card Factory store sales jumped 82% year on year, but 6.1% on a like-for-like basis when adjusted for lockdown restrictions in early 2021.

The retailer said that online sales were down compared with last year, but still up significantly compared with pre-pandemic levels – jumping 86% on a three-year basis.

Throughout the six-month period, Card Factory opened six stores in the Republic of Ireland and has begun trialling smaller format stores in central London.

The retailer has been building up its complementary categories including gifting, flowers, partywear and alcohol, and added that it has been buoyed by consumers’ desire to celebrate big life moments.

Chief executive Darcy Willson-Rymer said: “We are pleased to report a strong performance through the half which reflects continued good momentum within the business, as well as the reversal of lockdown trends with customers choosing to return to the high street. 

“The pronounced shift in spend back towards stores supports our continued conviction in the value of our store estate within our customer proposition and as an enabler in our omnichannel ambitions.

“The inflationary pressures we are all facing are well known, however the pre-emptive actions we have taken – such as the fixing of energy costs until September 2024 and targeted price increases – have helped to offset these. 

“Despite these ongoing challenges, we remain confident that our customers will continue to want to celebrate life’s moments and that value for money is increasingly important to them. Card Factory offers great value for money across a range of products and price points, and our experience so far this year confirms how well this resonates with consumers.

“Whilst we remain mindful of the challenging economic backdrop as we head towards the Christmas season, we feel well placed to navigate this and retain our focus on transitioning Card Factory to a market-leading omnichannel retailer of cards and gifts.”

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