Christmas sales dip 27pc at Card Factory as Royal Mail chaos bites

RETAILER Card Factory said it suffered a 27pc drop in online sales as it revealed the impact of Royal Mail strikes.

However, the company upgraded its full-year earnings outlook and said store sales rose 7.1pc on a like-for-like basis in the 11 months to the end of December, as shoppers returned to the high street for the festive season.

Sales at cardfactory.co.uk slumped 27.6pc year on year, affected by last month’s Royal Mail strikes, as well as the increase in customers shopping in bricks-and-mortar stores, though it stressed that its online trading remains far higher than pre-pandemic levels.

Postal workers took part in industrial action on six days in December, leading to widespread disruption. Last week, it emerged that nearly 40pc more packages were returned between Christmas and new year compared with 12 months earlier, according to figures from Rebound, which processes millions of returns every year from retailers including River Island and John Lewis.

Laura Garrett, at Rebound, said retailers were dealing with the fallout from last month’s postal strikes, which meant many online orders arrived too late to give to loved ones on Dec 25. Card Factory said its strong recent Christmas performance means it is on track for underlying earnings of at least £106m for the full year, against the £96.9m expected in the City. This will put it on track for pre-tax profits of around £48m, it added. Card Factory shares rose 5pc to 91.6p yesterday .

Darcy Willson-rymer, chief executive, said: “We’re pleased and encouraged by the strong performance of the business. With delivery of our growth strategy progressing well, it is great to see some of the benefits from this work starting to come through in our financial performance.”

Card Factory is also rolling out a new store format across its estate, with 10 of these stores now trading and more to be converted over the year ahead.