Card Factory sees sales growth slow after weaker Father’s Day quarter
The group also revealed further stockpiling amid no-deal Brexit fears.
Retailer Card Factory has said it rang up higher half-year sales despite a weaker Father’s Day quarter as fewer customers hit the high street.
The group said like-for-like sales rose 1.5% – or 1.2% higher excluding the online business – in the six months to July 31.
But the half-year result marked a slowdown from the first quarter, when like-for-like sales rose 2.3% and Card Factory said trading conditions remained “challenging”.
The group also said it had taken extra costs for stockpiling ahead of the October 31 Brexit deadline as it puts in place contingency plans for a possible no-deal withdrawal.
It did not give any further details on its stockbuilding efforts, but said alongside final results in April that it had been buying in extra goods ahead of the original March 29 Brexit date amid concerns over ports disruption in a no-deal scenario.
The chain said it remained “broadly” on track for the full year as it prepares for its busiest season over the next few months.
Karen Hubbard, chief executive of Card Factory, said: “We believe we have the right ranges and products to deliver a good performance; although, we are cognisant of the economic and political uncertainty and weaker consumer confidence.”
Card Factory shares fell 1%.
The group said total sales rose 5.5% as it continued to open new stores, launching another 26 on a net basis in its first half.
It stuck by its target for around 50 over the UK and Ireland in the full year.
But the group said its Getting Personal online arm remained under pressure, with sales down 10.5% in the half-year due to “intense” competition and costs of attracting new customers.
Jonathan Pritchard at Peel Hunt cautioned that Card Factory continues to face headwinds.
He said: “Sales growth has slowed markedly in the second quarter, and card volumes must be down.
“This is the fundamental issue that Card Factory faces – this may not be a bad performance versus the wider market but volumes continue to struggle and there’s little to suggest that this trend will change.”