Shares in Card Factory (LON:CARD) rallied after the cut-price greeting cards-to-gifts retailer maintained FY27 profit guidance despite the tough consumer backdrop. Led by CEO Darcy Willson-Rymer, Card Factory said its UK store like-for-like sales have improved since the end of H1. In fact, they have returned to positive growth in recent weeks.
The Wakefield-based retailer also insisted it has ‘strong’ plans in place for the all-important ‘Golden Quarter’ including Halloween and Christmas. As such, Card Factory is confident in delivering FY27 adjusted pre-tax profits in line with market forecasts. Consensus calls for profits in the £54 million to £59 million range with an average of £56.7 million.
Return to positive growth
Card Factory’s results for the half to 31 July 2026 were pretty resilient considering the weak UK consumer sentiment and subdued high street footfall witnessed in H1.
Adjusted pre-tax profits fell 3.8% to £12.7 million as improved store profitability was offset by investment in digital operations and international expansion.
| H1 financial highlights | H1 | Change |
| Revenue (£m) | 260.8 | +5.3% |
| Adjusted PBT (£m) | 12.7 | -3.8% |
| Dividend (p) | 1.4 | +7.7% |
| Net debt exc. leases (£m) | 87.4 | +£8.5m |
Source: Card Factory, interim results
Revenue grew 5.3% to £260.8 million despite weaker trading in Card Factory’s UK stores. This reflected a boost from acquired online personalised cards site Funky Pigeon and continued growth in wholesale revenues.
Like-for-like store sales were down 2% in H1. However, Card Factory has been ‘encouraged by trading since the half year, with UK store like-for-likes improving from H1 levels and returning to positive growth in recent weeks’.
What did Darcy say?
Willson-Rymer commented: ‘We made further progress in the first half towards building a broader, more diversified celebrations business. Despite continued pressure on the UK consumer, group revenue increased and profitability remained broadly flat, with improved store profitability and disciplined working capital management delivering strong free cash flow.’
He added: ‘The ongoing development of our partnerships and international businesses are broadening our reach and creating further opportunities for growth, and the integration of Funky Pigeon and delivery of the expected synergies remain on track.’
It has been a rough few years for Card Factory, with its share price shredded by profit downgrades. While the UK consumer backdrop remains uncertain, we find today’s update encouraging on a number of levels.
Card Factory is successful transitioning from a predominantly UK store-based card retailer into a broader celebrations business with a larger addressable market. Furthermore, the firm is strengthening its store estate and lifting product margins. And the digital and wholesale businesses are growing very nicely indeed.
In H1, wholesale sales grew 13.6% in H1 thanks to good performances from partnerships with The Reject Shop, Aldi, and Garlanna in the Republic of Ireland.
We think the specialist retailer’s value proposition should appeal to cash-strapped consumers over Christmas. And Card Factory’s shares look cheap on a single digit price-to-earnings ratio, so there is re-rating potential here.
The challenge for management now is to reduce net debt levels. And to demonstrate that Card Factory is more bargain buy than value trap.
Disclaimer: The author James Crux has a personal interest in Card Factory.
