Shares in budget greetings cards-to-gifts purveyor Card Factory (CARD) sank 12.7% to 38.52p on Monday, despite the retailer announcing Darcy Willson-Rymer as its new chief executive.
The tighter Tier four restrictions announced at the weekend, with all but essential shops closed until further notice, will test the group’s renewed focus on its new online and partnership strategy.
Willson-Rymer knows the challenges ahead having previously run rival Clinton Cards between 2011 and 2012.
He will join Card Factory on 8 March when his notice period at Costcutter Supermarkets ends, at which time current executive chairman Paul Moody will revert to his role of non-executive chair.
Moody said, ‘Darcy has excellent credentials and experience to lead Card Factory through the next phase of our evolution and to continue to lead the implementation of the refreshed strategy.’
BLOW TO AMBITIOUS TARGETS
Wakefield based Card Factory unveiled a new strategy in July which targets reaching £635 million of revenues and £105 million of pre-tax profits by 2025. Consensus analyst expectations are for revenues for the year to 31 January 2021 to be around £323 million.
The ‘capital light’ strategy involves building around 5,600 UK and International distribution points through retail partnerships such as Aldi and a tripling of online sales while selectively closing and relocating some of the physical stores.
The company expects Willson-Rymer’s prior experience in managing complex, multi-site operations at Costcutter and knowledge of operating owned and franchised stores while at Yum Brands and Starbucks to be instrumental in delivering on the new strategy.
At the interim update like-for-like revenues fell 6.9% in the four weeks to 20 September with transactions down 24% and basket value up 23%. The newly launched website saw revenues grow 87.7% on a like-for-like basis but they remain relatively small at £13.3 million.
