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.

WELCOME BONUS - Free Share Bundle When You Invest £50! Get up to £500 cashback for investing with IG.

Invest in 15,000+ shares and ETFs. Open an account now, invest at least £50, and you’ll get a free share bundle worth between £40 and £200. T&Cs apply.

5.0

Open Account Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 68% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.

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.