In the year to January 31, Card factory has reported a pre-tax loss of £14.6 million while underlying ebitda dropped 62.7%. Revenues for the card specialist fell 36.9% to £285.1 million and like-for-likes rose 0.1%.
However, the retailer's online sales surged 135.3% during the pandemic and the retailer said the losses were due to store closures.
“The greetings card sector has gone through a turbulent year with the closure of non-essential retail significantly impacting card specialists-many of whom depend on the high street presence. On top of this, the UK national lockdowns could not have come at a worse time with specialists forced to close shop ahead of key seasonal trading events such as Mother’s Day, Valentines Day and Easter-all of which were celebrated in lockdown. Card Factory’s reported loss of £14.6 million before taxes and 36.9% drop in revenues further highlights the magnitude of how the pandemic has affected store-based retailers in the past year. This is in stark contrast to its online-only competitors such as Moonpig who have been stand-out performers during lockdown as shoppers looked online for personalised cards to send to loved ones. Card Factory heavily relies on its extensive store portfolio to capture spend from shoppers on the high street, a strategy which before the pandemic, served well in combination with its cheap and affordable cards. In fact, shoppers are still opting to buy cards in-store with 78% having done so in the past year (see Mintel’s Report on Greetings Cards and Personal Stationery - UK, February 2021). Since reopening stores again after a third UK lockdown the retailer has highlighted its store sales have exceeded previous reopening performances - making for a promising start as the important summer trading period approaches with Father’s Day expected to attract footfall back into stores.”