Card Factory profits impacted by foreign exchange and National Living Wage
Card Factory has reported what it described as solid first half results with an uplift in like-for-like sales and revenue although profits were hit by the impact of currency headwinds and the National Living Wage.
In the six months to 31 July, revenue climbed by 6.1% to £179.6 million while like-for-like sales rose by 3.1%. However, underlying pre-tax profit was down 4.8% to £26.3 million.
Karen Hubbard, Card Factory chief executive, said: "We have delivered a solid set of interim results with strong growth in like-for-like sales and total revenue, despite the decline in footfall seen across the high street; however, profitability over the half year was impacted by foreign exchange, national living wage and some of the important investments we are making in the business for longer term growth.”
During the period, Card Factory opened 30 net new UK stores bringing the total UK estate to 895 stores as at 31 July 2017 with one trial store in Republic of Ireland. The company is on track to deliver approximately 50 net new UK stores in the current financial year. Card Factory said new stores in retail parks have performed ahead of expectations.
Giving an update on more recent trading, Card Factory said it has continued to see growth in average spend as customers respond well to its new and improved ranges.
Hubbard added: “The board is confident that the group will continue to make further strategic progress, although notes that the full year profit outturn will reflect a continuation of some of the headwinds identified in the first half. We remain as convinced as ever of the strong growth prospects for the business."
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