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Card Factory gives green light to flotation

card factoryCharterhouse owned retail giant Card Factory today gave the green light to its stock exchange flotation as it revealed EBITDA of £80.4 million for the past year.

 

Greetings card retail chain Card Factory, which operates over 700 stores around the UK, announced this morning that it will be floated on the stock exchange and will raise £90 million to reduce the company’s debt.

Card Factory’s earnings rose 9.2 per cent to £326.9 million from a sales increase of 9 per cent in the year to January 31. It sold a whopping 5.5 million greeting cards each week and achieved an EBITDA margin of 24.6 per cent.

The company has invested £50m into its business over the past ten years to support its strong and steady growth. Charterhouse currently has a 60 per cent stake in the business with management owning the majority of the balance.

Speaking of Card Factory’s strong position, Chief executive, Richard Hayes gave a nod to the UK’s world leading greetings market, saying: “The scale, resilience and continued growth of this market reflect the facte that the giving of physical cards is and will remain ingrained in UK culture.”

The greetings card market in the UK was estimated to be worth £1.4bn in 2012, growing at a rate of 1.4 per cent a year between 2009 and 2012, according to OC&C. Management estimates the gifting market is worth £1bn to £2bn in this country.

The former head of Travis Perkins Geoff Cooper joined the Card Factory board last month, while Crew Clothing managing director Octavia Morley and Dunelm finance director David Stead are both joining as non-executive directors.

Hayes commented further that Card Factory’s “vertically integrated model” that incorporated in-house design and production enabled it to sell cards at the budget prices for which it is renowned. The company has achieved like-for-like growth every year since its first store opened in 1997.

Having opened an average of 50 stores each year, Hayes said that significant growth is still possible in the UK and Ireland, citing a target of 1,200 stores in the next ten years. Via its gettingpersonal.co.uk website Card Factory also aims to grow its market share for personalised online cards and gifts.