Card Factory (CARD) H2 2026 earnings summary

Executive summary

• Revenue grew 7.4% year-over-year to £582.7m, driven by new store openings, acquisitions (notably Funky Pigeon), and digital expansion, despite challenging UK consumer sentiment and declining footfall in H2.

• Adjusted profit before tax (PBT) was £56m, reflecting weaker H2 trading and ongoing cost inflation, partially offset by cost efficiencies.

• Strong free cash flow generation of £40.7m (99% of adjusted earnings), supporting a progressive dividend and share buyback program.

• The acquisition of Funky Pigeon accelerated digital strategy and contributed £13.5m in revenue.

• Strategic progress included expanding the store estate, accelerating digital transformation, and integrating acquired businesses.

Financial highlights

• Group revenue increased 7.4% to £582.7m compared to the prior year; store sales up 1.5%, digital sales up 57% due to Funky Pigeon acquisition.

• Adjusted PBT was £56m, in line with guidance, but down year-on-year due to softer UK store performance in H2.

• Free cash flow reached £40.7m, with adjusted leverage just below 1x.

• Net debt closed at £67.9m, mainly due to the Funky Pigeon acquisition.

• Dividend of £0.05 per share (up from £0.048), plus a £5m completed buyback and a new £15m buyback announced.

Outlook and guidance

• FY 2027 adjusted PBT expected in line with market consensus (£54.8m–£60.5m), with profit delivery weighted to H2.

• Capital expenditure for FY 2027 to be £20m–£25m, including one-off investments for Funky Pigeon integration and manufacturing upgrades.

• Free cash conversion expected at the lower end of 70%-80% target range due to higher CapEx.

• Medium-term targets: mid-single-digit sales growth, 70%-80% free cash conversion, and mid- to high-single-digit PBT growth.