Card Factory Share Price Hits Lowest Level in 3 Years After Profit Warning

Card Factory (LON: CARD) shares slumped more than 25% on Friday, initially dropping to around 70p, hitting their lowest level since December 2022, after the retailer issued a profit warning ahead of its crucial Christmas trading period.

The company stated that the “pressures facing the UK consumer have been well publicised” and acknowledged that these strains have weighed heavily on confidence and shopping behaviour. With “soft high street footfall” persisting into the peak season, the group reported that UK store sales are running below expectations.

Card Factory now expects to deliver adjusted profit before tax of between £55 million and £60 million for the full financial year, based on the assumption that current trading trends continue over the remaining seven weeks. This would fall well below the £66 million reported last year.

The downgrade marks a significant setback for the retailer, which had been working to reinforce its margins through its “Simplify and Scale” productivity programme.

Despite the weak UK performance, the company noted that progress on its long-term strategy “has continued,” highlighting ongoing efficiencies and steady trading in its businesses in the Republic of Ireland and North America. 

The integration of online brand Funky Pigeon remains on track, the group added.

Card Factory stressed that the board “remains confident” in the long-term strategy, noting that its share buyback programme will continue. 

The company also said it still expects to declare a “progressive” full-year dividend in line with its capital allocation policy.