Card Factory braces for ‘difficult’ 2020 after challenging Christmas
The company expects its profits to be flat next year.
Card Factory has warned that underlying profits for the 2020 financial year are likely to be flat, as it braces for another “difficult” trading period.
It comes after a “challenging” Christmas period for the company, with like-for-like sales down 0.5%.
The retailer said it still expects to deliver earnings of between £89 million and £91 million for the current financial year.
Shares in Card Factory were down more than 9% in early trading on Thursday.
Card Factory revenue was up 3.4% in the 11 months to December 31.
Like-for-like sales growth was broadly flat at 0.1%.
Chief executive Karen Hubbard said footfall on the high street was lower than last year, but that like-for-like sales were in line with the third quarter performance.
Overall for the year to date, group revenue grew 3.4%. This was largely due to the 51 new store openings, which brought the total estate to 973.
Card Factory has also said it would mitigate growing costs such as the National Living Wage and electricity prices.
Ms Hubbard said: “Although the Group has faced significant cost pressures in the year, these have reduced and we have been able to take mitigating action to maintain robust gross margins.
“Whilst we expect ongoing challenges from the consumer and macro backdrop, we continue to lead the market with our proposition, underpinned by our ongoing investment in our unique vertically integrated model which provides our business with significant competitive advantages.”