Trading update

RNS Number : 8838M

Card Factory PLC

26 January 2016

 

Card Factory plc ("Card Factory" or the "Group")

Trading update

Another year of consistent strong growth and strategy execution

Card Factory, the UK's leading specialist retailer of greeting cards, dressings and gifts, is pleased to announce a trading update for the 11 months ended 31 December 2015. 

Key highlights

·      Like-for-like store sales growth of +2.8% (11 months ended 31 December 2014: +1.8%)

·      Total sales growth of +8.1% (11 months ended 31 December 2014: +8.1%)

·      50 net new stores opened in the period in line with historic and projected roll-out rate

·      Further development of both Getting Personal and Card Factory transactional websites

·      Board's expectations for the full financial year unchanged

Recent trading performance

Card Factory has continued to trade in line with the Board's expectations.

The Group delivered a good level of growth in the period driven by a combination of like-for-like sales growth, new store roll out and further growth in our complementary online activities.  Like-for-like sales growth benefited from particularly strong growth in non-card products, which continued through the Christmas trading period.

50 net new stores were opened in the period, bringing the total estate to 814 stores as at 31 December 2015.  Looking ahead to our next financial year ending 31 January 2017, the Group has a strong pipeline of additional new store opportunities and we remain confident of continuing our historic opening rate of approximately 50 net new stores per annum. 

Our principal online business, Getting Personal (www.gettingpersonal.co.uk), has continued to deliver the targeted double digit revenue growth in the second half.  As highlighted in our interim results, this strong growth was, as expected, at a lower level than the 24.9% revenue growth achieved in the first half given the much tougher comparative in the second half of last year when turnover increased by 27.1%.  The trial of the relaunched Card Factory transactional website (www.cardfactory.co.uk) is also progressing well and more detail will be given in the preliminary results in April.

The Group continues to be highly cash generative.

Richard Hayes, Card Factory's Chief Executive Officer, said:

"As we approach the end of our financial year, it is pleasing to report that the Group has continued to perform well through the important and competitive Christmas trading period.

"We remain on course to deliver sales growth at a similar level to last year, highlighting once again the strength and consistency of our retail proposition and performance, underpinned as ever by our unique vertically integrated model."

As announced on 6 January 2016, Karen Hubbard will join the Board as CEO Designate on 22 February, and will succeed Richard Hayes as CEO in mid-April.  Richard will retire from the Board and leave the Group at the end of June 2016, following a four-month handover period.

ENDS

Enquiries

Card Factory plc                        [phone]

Richard Hayes, Chief Executive Officer

Darren Bryant, Chief Financial Officer

MHP Communications                [phone]

John Olsen                        

Kelsey Traynor

Preliminary results announcement

Preliminary results for the year ending 31 January 2016 will be announced on Tuesday 5 April 2016.  There will be a presentation for analysts at 9.30am at the offices of UBS, 1 Finsbury Avenue, London EC2M 2PP. Those analysts who wish to attend are requested to contact Isabelle Grainger of MHP on the above number or at [e-mail].  A copy of the presentation will be made available on the Card Factory investor relations website (www.cardfactoryinvestors.com).

Notes to Editors

Card Factory is the UK's leading specialist retailer of greeting cards, dressings and gifts. It focuses on the value and mid-market segments of the UK's large and resilient greeting cards market, and also offers a wide range of other quality products, including small gifts and gift dressings, at affordable prices.  Card Factory principally operates through its nationwide chain of over 800 Card Factory stores, as well as through its online offerings: www.gettingpersonal.co.uk and www.cardfactory.co.uk.

The Group's clear strategy is focused on four pillars of growth:

-       continuing to grow like-for-like sales in existing stores;

-       continuing to roll out profitable new stores;

-       continuing to focus on delivering business efficiencies; and

-       increasing penetration of the complementary online market.

Card Factory commenced operations in 1997 with just one store and has expanded its store estate primarily through organic growth into a market-leading value retailer with a nationwide presence. The Group's stores are in a wide range of locations including on high streets in small towns through to major cities, shopping centre developments, out-of-town retail parks and factory outlet centres.

Over the last 10 years, Card Factory has developed a vertically integrated business model with an in-house design team, an in-house printing facility and central warehousing capacity of over 360,000 sq. ft.  This model differentiates the Group from its competitors by significantly reducing costs and adding value to customers in terms of both price and quality, underpinning the Group's motto: "compare the quality, compare the price".

In the financial year ended 31 January 2015, the Group achieved revenue growth of 8.1% to £353.3 million (FY14: £326.9 million) and underlying EBITDA growth of 9.6% to £88.2 million (FY14: £80.4 million) at a margin of 25.0% (FY14: 24.6%).

Cautionary Statement

This announcement is based on information from unaudited management accounts and contains certain forward-looking statements with respect to the financial condition, results of operations, and businesses of Card Factory plc.  These statements and forecasts involve risk, uncertainty and assumptions because they relate to events and depend upon circumstances that will occur in the future. There are a number of factors that could cause actual results or developments to differ materially from those expressed or implied by these forward-looking statements. These forward-looking statements are made only as at the date of this announcement.  Nothing in this announcement should be construed as a profit forecast.  Except as required by law, Card Factory plc has no obligation to update the forward-looking statements or to correct any inaccuracies therein.

 

END

 

 

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