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Card Factory hit by weather and wary consumers

Liberum reduced its price target to 195p from 210p after the cards and gifts retailer lowered its profits expectations
greeting cards
Christmas will be more important than usual

Card Factory PLC (LON:CARD) was hit by a price target reduction from its house broker after a downbeat trading update.

Liberum reduced its price target to 195p from 210p after the cards and gifts retailer lowered its profits expectations for the year ending January to between £89-91mln.

READ: UBS posts an upgrade for Card Factory as it turns positive on growth prospects

Karen Hubbard, chief executive, said the company was facing a weak consumer environment, made worse by the extreme weather conditions. 

"The performance of our seasonal ranges has been strong, with our best ever Father's Day in terms of volume and value, although we recognise there has to be more focus on our Everyday ranges, which have lagged the seasonal performance.”

Getting Personal also struggled with sales down by 8.5% in the half year to July.

Total group sales grew by 3.2%, but dipped 0.2% on a like-for-like basis.

Christmas trading will be even more critical than usual, Hubbard said, though the retailer still intends to pay a special dividend of between 5-10p.

Peel Hunt added that the wider/improved ranges at the superstores and the discounters appear to be taking a toll.

"The new designs and improved store navigability are not resonating with customers it would seem," added the broker.

Shares fell 9% to 192.6p.

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