Card Factory upgrades its full-year earnings outlook after recording 'strong' performance

But it said sales at cardfactory.co.uk slumped 27.6 per cent year-on-year, after its performance was impacted by last month’s Royal Mail strikes as well as the increase in customers shopping in store, although it stressed trading on the site remains far higher than pre-pandemic levels.

The firm said its strong recent Christmas performance means it is on track for underlying earnings of at least £106m for the full year, against the £96.9m expected in the City.

This will put it on track for pre-tax profits of around £48m, it added.

Shares in Card Factory lifted 6 per cent in morning trading on Tuesday.

Darcy Willson-Rymer, Chief Executive Officer, commented: "We're pleased and encouraged by the continued strong performance of the business. With delivery of our growth strategy progressing well, it is great to see some of the benefits from this work starting to come through in our financial performance.

"I'd like to thank all our colleagues who have supported these changes and worked tirelessly over the important Christmas trading period. There is still more work to be done but we are very excited by the opportunities ahead and have confidence in our ‘Opening Our New Future’ growth strategy."

The trading update added: “Strong seasonal trading in stores over the Christmas period was supported by our range development and value for money offer across both cards and gifts.

"Christmas trading also benefitted from the agility provided by our vertically integrated model, as well as forward ordering and delivery of Christmas ranges, which underpinned strong availability in stores across the Christmas period.”

The group said it was also pleased with the progress it has made with its growth strategy

The statement added: “We have continued the initial roll out of our new model store format, with 10 stores now open and generating an uplift to sales compared to comparator stores.

"Further conversions of a number of stores are planned for FY24 (the 2024 financial year).

The statement added: “In September we launched our Click & Collect trial, which is now live in 85 stores and have seen a positive initial reaction to the service.

"We continued to expand our complementary categories, launching alcohol, flowers, confectionery, and gift experiences on cardfactory.co.uk.

"We have also continued work on securing good foundations for future partnership opportunities.”

Commenting on the trading outlook, Card Factory said: “While remaining mindful of the challenging economic backdrop, we take confidence in our compelling value for money proposition and the level of ongoing customer demand.”

The Card Factory said it had continued to successfully manage inflationary pressures over the financial year and is hedged on energy costs until September 2024.

The statement added: “We are monitoring the impact of other cost pressures affecting our sector and will update further in our preliminary results.”

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