Card Factory to meet FY profit expectations despite challenging backdrop

(Sharecast News) - Greeting cards and gifts retailer Card Factory said on Wednesday that it was on track to deliver profits in line with revised guidance despite a "challenging" consumer backdrop and a fall in sales over the Christmas period. In an update for the 11 months to the end of December 2025, the company said total group revenue rose 7.3% on the year to £541.6m, supported by positive contributions from acquired businesses. Total stores sales were up 1.1%, while LFL store sales were flat.

Card Factory said trading across November and December was in line with its revised expectations, "reflecting the challenging UK consumer backdrop and lower footfall across UK shopping destinations".

Total group revenue grew 4.3% compared to the same period a year earlier, but total store sales were down 0.8% and LFL store revenue was 1.2% lower.

The company, which issued a profit warning in December, said it expects to deliver its revised guidance of FY26 adjusted pre-tax profit of between £55m and £60m.

Chief executive Darcy Willson-Rymer said: "During the second half of the year and particularly the important Christmas period, trading in our UK stores reflected the challenging consumer backdrop which contributed to soft high street footfall. Across the group, we are encouraged by the performance of our international businesses and that the integration of Funky Pigeon remains on track.

"While the outlook for the UK high street remains uncertain, we continue to focus on our value-led proposition to help our customers celebrate all life's moments. In addition, we continue to successfully drive efficiencies and manage costs through our 'Simplify and Scale' programme. The board remains confident in the group's prospects and continued momentum of our growth strategy."

At 1015 GMT, the shares were down 0.6% at 69.21p.

Dan Coatsworth, head of markets at AJ Bell, said: "Card Factory had already delivered a painful message pre-Christmas when it blamed negative consumer confidence and patchy high street conditions for depressing earnings. The rest of the festive season continued in this fashion, meaning it goes into 2026 from a position of weakness.

"The market will now have to wait until April for an update on longer-term strategic plans for the business.

"In its defence, Card Factory has shown resilience in recent years despite a general downturn in sending letters and cards by post. It has been pushing hard on extras like balloons and gifts, while also keeping prices as low as possible on cards as it plays the volume game.

"It is a profitable business and a mainstay of UK retail. What's uncertain is by how much profits can grow in the future. Card Factory is having to work hard just to stand still, and it might need more radical ideas if it wants to become a bigger player."