"Positive start" for Card Factory

The Card Factory reported positive growth in like-for-like sales from its existing stores and a "strong pipeline" of new store opportunities in its interim management statement on Wednesday.

The Wakefield-based discount greetings card retailer, recently admitted to trading on the London Stock Exchange, recorded trade in line with expectations, although no figures were given, and outlined its store roll out programme. It has big growth ambitions.

In the first four months of the financial year, 29 net new stores were opened, bringing the total estate to 742 stores as the end of May. A further 50 net new stores are planned for the current financial year, a continuance of the 50 new stores it has opened every year for the past decade.

The target is 1,200 stores over the next 10 years, including up to 100 in the Republic of Ireland.

Card Factory floated on 20 May, and earlier this month it completed the refinancing of its existing senior bank facilities, which include a £180 million term loan facility and a £20 million revolving facility, both with a five-year maturity.

The greeting cards firm had net debt of approximately £160 million when it listed representing approximately two times underlying earnings before interest, taxes, depreciation, and amortisation for the last financial year, and said on Wednesday that its financial position has not changed materially.

Richard Hayes, chief executive, said: "We have had a positive start to our current financial year, further developing our distinctive value proposition and continuing to deliver on our clear growth strategy. The board remains confident of the group's ability to further grow market share for the foreseeable future."

The discount retailer, which keeps costs down by designing and printing all its own cards, claims it sells 26% of all cards in the UK and runs on an operating margin of 22%. Both its sales and profits have risen by around one quarter since 2012, to around £327 million and £73 million respectively.

The chain was founded in 1997 by Dean Hoyle, owner of Football League Championship team Huddersfield Town, who built up the business with his wife Janet, who realised the value of the vertically integrated model in this otherwise fragmented industry, which was worth £1.37 billion in the UK last year - more than tea and coffee put together, according to the Greeting Card Association.

The shares were flat at 209p.