16 January 2024
Card Factory plc
("cardfactory")
Trading Statement
Positive momentum across the business; effective execution of growth strategy
Full year adjusted profit before tax expected to be at the top of the range of market expectations
cardfactory, the UK's leading specialist retailer of greeting cards, gifts and celebration essentials, announces a trading update for the eleven months ended 31 December 2023.
Trading Update
· Total sales for the eleven months ended 31 December 2023 of £476.9 million (prior year of £432.6 million), an increase of 10.2% year-on-year, reflecting continued positive momentum across the business and the effective execution of our strategy:
o Store revenue grew +8.2% on a Like-For-Like1 (LFL) basis, reflecting the strength of our value and quality proposition across card and gifts combined with the positive impact of our Store Evolution Programme.
o Continued positive performance in Everyday and seasonal card ranges, with +5.4% LFL growth in the period. This was supplemented by strong growth in our gifts and celebration essentials ranges of +9.9% LFL, including double-digit growth in categories such as candles and soft toys.
o Online2 LFL sales of -12.8% for the 11 months to 31 December, an improvement from the half year driven by positive performance in cardfactory.co.uk (YTD +0.2%), reflecting the ongoing investment in online capability, platform performance and customer experience.
o Further progress in Partnerships, including a profitable contribution from new partnerships with Matalan and Liwa Trading Enterprises.
o Recently acquired SA Greetings continues to perform in line with expectations, contributing £9.1 million of revenue in the period.
1 The Like-For-Like (LFL) calculation is based on gross sales for Stores that were trading in both the current year and the comparative period.
2 "Online": Like-for-like sales for cardfactory.co.uk and gettingpersonal.co.uk combined.
Christmas Trading
· Strong Christmas trading performance with LFL store revenue +7.8% in November and December. This was driven by the increased number of transactions and increased average basket value; targeted price increases enacted in the prior year had fully annualised before the Christmas period.
o Strong year-on-year growth in seasonal cards reflecting insight-led innovation to develop and broaden the appeal of the overall range.
o Expanded gift offer and introduction of key licensed ranges, alongside the expansion of own label, resonated well with customers.
o Very encouraging performance at cardfactory.co.uk with double-digit LFL sales growth in November and December.
o Positive impact of our Store Evolution Programme enabled the optimisation of space to ensure the correct balance between Christmas cards, gifts and celebration essentials.
o Improvements in stock management and replenishment processes enabled us to capitalise on particularly strong demand in the second half of December.
Outlook
Given the strength of performance in the year to date, the Board expects to deliver full year adjusted profit before tax (excluding one off items) at the top of the range of market expectations3 and remains confident in the achievement of the long-term financial and operational targets set out at our Capital Markets Strategy Update in May 2023.
3 According to Company-compiled consensus estimates as of 15 January 2024, the current range of market expectations for FY24 adjusted profit before tax is £58.4 million to £62.0 million.
Darcy Willson-Rymer, Chief Executive Officer, commented:
"We are pleased to have delivered a strong performance over the Christmas period, further demonstrating the progress we are making on our strategic growth initiatives. Our value and quality proposition continues to resonate with customers at a time when value for money is as important as ever. Even during challenging times, consumers want to celebrate key life moments and this was reflected in the positive performance that we saw in the Christmas trading period and throughout the year to date."
"Colleagues across all areas of our business have worked incredibly hard to deliver an improved experience for our customers this year. As we look ahead, we remain focused on delivering against our growth strategy by helping our customers to affordably celebrate all life's moments."
Notification of Preliminary Results
We will announce our Preliminary Results for the year ended 31 January 2024 on 30 April 2024.
Enquiries
Card Factory plc via Teneo (below)
Darcy Willson-Rymer, Chief Executive Officer
Matthias Seeger, Chief Financial Officer
Teneo +44 (0) 207 353 4200
James Macey White / Jo Blackshaw cardfactory@teneo.com
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