// Card Factory slashed its profit outlook on the back of weak Christmas trading.
// Like-for-like sales for the 11 months to December declined by 0.6%, accelerating from a 0.1% drop in the same period 2018
// Card Factory now expects underlying earnings between £81-£83m, a decline from £89.4m last year
Card Factory shares have taken a hit after the retailer slashed its outlook on the back of weak Christmas trading.
The greeting cards retailer said its performance over the crucial trading period was “softer than anticipated” amid “challenging” conditions.
It blamed the continuing drop in high street footfall, which it said was maintained as result of the General Election and “weak” consumer sentiment.
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The retailer said it partially offset footfall decline by improving product quality and the size of transactions, but like-for-like sales for the 11 months to December declined by 0.6 per cent, accelerating from a 0.1 per cent drop in the same period a year earlier.
New store openings resulted in a 3.6 per cent increase in total revenues as it added 47 outlets to take its total estate to 1019.
Card Factory said it expected to post underlying earnings between £81 million and £83 million for the current full year, a decline from £89.4 million last year.
The retailer added it also expected declining footfall, weakness in sterling and cost rises to press down on earnings in the 2021 full year.
“Our investment in our customer experience, operational efficiency and data to improve our ranges has helped us to mitigate some of the effects of the tougher retail environment and higher costs experienced in the year,” chief executive Karen Hubbard said.
“We plan to invest further in the business, enhancing our ability to operate more efficiently, service new sales channels and increase our competitive advantage, enabling a return to profit growth after the next financial year.”
Shares in Card Factory plunged by 22.5 per cent to 108.5p in early trading this morning after the trading update.
with PA Wires
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