Card Factory revenue up 28% to £364m

Shares of Wakefield-based greeting card and gift retailer Card Factory rose about 5% on Tuesday after it published results for the year to January 31, 2022, showing its revenue rose 28% to £364.4 million.

Card Factory said the results were driven “by a steady recovery in store performance following easing of lockdown restrictions, alongside an online performance significantly ahead of pre-pandemic levels.”

Card Factory reported a profit before tax of £11.1 million compared to a loss before tax of £16.4 million in the prior year.

On current trading and outlook, Card Factory said: “We expect our performance through the balance of the year to increasingly benefit from the strategic improvements we are making including expansion of complementary categories, further roll out of our trial model stores and highly targeted price increases …

“The board expects that the business will deliver revenue recovering towards pre-pandemic levels in FY23.

“As previously guided in January, the board expects significant inflationary headwinds to continue through FY23.

“Pre-emptive action has already mitigated a significant proportion of the identified inflationary headwinds through a combination of efficient management of costs and working capital as well as targeted price increases.

“While taking into consideration the inflationary headwinds mentioned above as well as the levels of trading seen in the new financial year, the board’s expectations for revenue and profit for FY23 remain unchanged.

“The board remains confident in the longer-term growth opportunity for the business and its expectations for revenues in excess of £600m in FY26.”

Card Factory CEO Darcy Willson-Rymer said: “We are pleased to report a robust performance for the year, ahead of our original expectations, alongside good progress on our strategic transition, despite the operational challenges the last year brought.

We saw a steady recovery in store performance as lockdown restrictions eased, particularly in the run up to Christmas with store sales approaching pre-pandemic levels in this key trading period.

“As we reopened our stores, we saw our online performance decline slightly year on year; however, we remain greatly encouraged that our Card Factory online sales were significantly ahead of pre-pandemic levels.

“This year will see us make further progress in developing our customer proposition, through a broader product range and improved online experience, as part of our transition to a leading omnichannel retailer.

Looking forward, we remain confident our revenue levels for next year will continue trending towards pre-pandemic levels.

“We have taken pre-emptive action to help mitigate the inflationary pressures we are seeing across the business and we will continue to monitor and respond to developing macro environmental pressures.

“Our focus is on creating opportunities across our store estate while building out our wider capability which will allow us to deliver our strategic initiatives and drive growth at pace.

We enter the year ahead with confidence in our ability to deliver our plan for FY23.

“We remain excited by the growth opportunity ahead and continue to focus on implementing changes to enable us to deliver on our transition from a store-led card retailer into a market leading, omnichannel retailer of cards and gifts.”