Profit warning at Card Factory amid weak consumer confidence

Card Factory has warned over profits in the face of weak high street footfall.

The retail chain said challenging conditions have persisted into the key festive trading period, meaning UK store sales have been “lower than previous expectations”.

It said it expects to deliver an adjusted pre-tax profit of between £55 million and £60 million for the year unless trading significantly improves.

The compares with previous expectations of a roughly £70 million profit.

The retailer’s shares had lifted since April amid a boost from resilient trading and progress in plans to improve its performance.

However, it said on Friday that most recent trading has been impacted by “pressures facing the UK consumer”.

The company said: “It is an inescapable fact that these pressures have impacted consumer confidence and shopping behaviour, contributing to soft high street footfall.”

Card Factory added that its long-term strategy has continued to progress over the period, including its productivity and efficiency programme to offset “ongoing high inflation”.

It also highlighted that its other businesses, including those in the Republic of Ireland and North America, are performing in line with expectations.

The integration of the Funky Pigeon online card business it bought from WH Smith in July is also “on track”.

The retailer added: “The board remains confident in the group’s long-term strategy.

“The share buyback programme will continue and the board anticipates declaring a progressive full-year dividend, in line with its capital allocation policy.”