Gifts Today magazine

Card Factory buck downturn

Sales jump across board helped by new Irish store and drive to expand range of products

THIRTY new UK stores and one in Ireland have seen Card Factory buck the High Street downturn with like-for-like sales jumping 3.1 per cent during the first half of the year as they press ahead with a drive to broaden their proposition.

In the first half trading update, released today (Thursday, August 10), the budget greetings specialists said the launch of the new locations helped underlying sales grow by 6.7 per cent, against 4.3 per cent in the same period last year with total sales climbing 6.1 per cent, reflecting the impact of one extra trading day in 2017.

The group’s online arm Getting Personal also returned to growth with sales up by five per cent against a year ago when the results were flat.

In the six months to July 31, Wakefield-based Card Factory opened 30 net new stores, plus their first one in Ireland, taking the estate to 895 outlets, and they are on track to open 50 in total this year.

The company said: “Following the opening of our first store, we have now secured further sites to continue our trial in the Republic of Ireland, and will monitor the performance of this small group of stores through the next financial year.

“The improved trading performance at Getting Personal is an early response to our actions, including the recruitment of a new senior team, and we continue to target Getting Personal revenue growth for the full year towards 10 per cent.

“We have continued to expand and improve the range of card and non-card products available on our websites, both personalised and non-personalised, as we target a significant increase in our share of this attractive segment of the market.”

Despite headwinds from foreign exchange movements and the national living wage, the group remain highly cash generative, driven by strong operating margins, limited working capital absorption and relatively low capital expenditure requirements.

Their policy is to return surplus cash to shareholders and they will provide an update on the size and timing of the next distribution ?along with the interim results announcement on September 26.

Chief executive Karen Hubbard said: “It is pleasing to report that the strong sales performance highlighted in our first quarter announcement has continued into the second quarter, delivering a very good first half both in terms of overall and like-for-like store sales.

“Our store expansion programme remains on track and we are pleased with the performance of this year’s openings, including strong sales from the increased proportion of openings in retail parks.

“The board’s expectations for the full financial year remain unchanged.”

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