Card Factory sees profit soar and is well-placed to manage pressures

But chief executive Darcy Willson-Rymer warned that the “economic backdrop” is challenging.

Card Factory is already preparing for the busy Christmas period, and is reorganising the displays in five stores ahead of the holidays.

“We are well prepared for our key Christmas trading season. Our Christmas programme has now launched and includes our first fully integrated marketing campaign,” the company said.

It said that all the stock it needs for Christmas has been manufactured so it can be delivered on time, and the company has not yet had any problems with the logistics required to get products made abroad to its shops. It is also recruiting staff for the period.

Mr Willson-Rymer said: “Our value and quality proposition and the strength of our store estate resonates with customers and positions us well to navigate the challenging economic backdrop in the run-up to the Christmas trading season.

“Continued leveraging of the insights gathered from our investment in customer data is enabling us to evolve and optimise our store formats and ranges across cards, gifts and celebration essentials, all underpinned by our discipline in maintaining a resilient financial position.”

The business said revenue rose 11.5 per cent in the six months to the end of July to £220.8m.

Like-for-like sales increased by 10.5 per cent in Card Factory shops, in part thanks to price rises, but online sales dropped 13.1 per cent.

“We are delighted to announce a strong performance in the first six months of this year,” Mr Willson-Rymer said.

Card Factory said the growing importance of gifts and celebration essentials has been a key driver of growth in the first half of the year, with LFL (like for like) revenue growth of 13.1 per cent.

Commenting on outlook, the Card Factory said: “While we remain mindful of the challenging economic backdrop and the impact of the cost-of-living crisis on discretionary spend, we continue to be encouraged by the resilience of the celebration occasions market and the growth opportunity it presents.

"Our experience in the first half of the year confirms that our value and quality proposition across our card, gift and celebration essential ranges continues to resonate well with customers.

“Based on our performance in the first half and our outlook for the second half, the board is confident in delivering a good outturn for the year.

“Trading since the August 2023 update has been in line with board's expectations.

"Given the combination of good trading momentum across the business and the successful delivery against our strategic initiatives, we remain confident in the long-term financial and operational targets set out at our Capital Markets Strategy Update in May 2023.”