Card Factory sales rise while weaker store demand restrains underlying profit

Card Factory ($CARD-LSE) reported first-half revenue of £260.8 million, up 5.3%, helped by Funky Pigeon and wholesale growth. Adjusted pretax profit eased 3.8% to £12.7 million as investment in digital and international operations offset improved store profitability. Statutory pretax profit rose to £12.3 million from £7.5 million. Store like-for-like sales declined 2%, reflecting pressure on footfall and consumer spending.

Cash generation improved: adjusted free cash flow was positive £0.8 million, compared with an outflow of £6.3 million. However, net debt excluding leases increased to £87.4 million from £78.9 million a year earlier. Management maintained full-year expectations and reported that UK store comparable sales had turned positive in recent weeks. Delivery still depends heavily on the peak trading quarter; expected Funky Pigeon synergies of £5 million remain a future-year target, not current realized savings.

Sources:

• Card Factory RNS half-year report