Card Factory (LSE:CARD) reported a 7.4% increase in revenue to £582.7m for the year ending 31 January 2026, supported by acquisitions and modest expansion of its store network. However, profitability declined as reduced high street footfall weighed on peak trading periods. Adjusted profit before tax fell 15.2% to £56m.
Digital operations were reshaped during the year, reflecting the acquisition of Funky Pigeon and the exit from non-core activities. Despite the profit decline, the business remained strongly cash generative, delivering £40.7m in free cash flow, although net debt increased slightly.
Efficiency programme and expansion initiatives support strategy
Management highlighted progress under its “Simplify & Scale” programme, which generated £21m in benefits and helped offset inflationary pressures. Investment continues in areas such as new point-of-sale systems and store segmentation, aimed at reinforcing Card Factory’s position as a leading destination for celebrations.
The group is also expanding its digital and wholesale capabilities, including integrating Funky Pigeon into the wider business and developing a strategy for the North American market. Confidence in cash generation is reflected in a higher dividend and plans for a £15m share buyback, despite ongoing macroeconomic and geopolitical uncertainty.
Strong valuation offset by weak technical picture
Card Factory’s outlook is supported by solid underlying financial performance and an attractive valuation, with a relatively low P/E ratio and high dividend yield appealing to income-focused investors.
However, technical indicators remain weak, with the share price trading significantly below key moving averages and showing bearish momentum, even as oversold conditions may limit further downside.
More about Card Factory
Card Factory is the UK’s leading specialist retailer of greeting cards, gifts and celebration products, operating more than 1,100 stores across the UK and the Republic of Ireland. Alongside its physical footprint, the company is expanding its digital and wholesale channels as it evolves into a broader global celebrations business, with a growing focus on party supplies, gifting and international markets.
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