Card Factory PLC - Covid 19 update
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Financial and operational update on response to COVID-19
Further to the announcement made on
Cash management has been a key area of focus during these uncertain times, whilst we have looked to protect the longer-term prospects of the business and its stakeholders. These measures have included utilising relevant government schemes where applicable, managing stock intake and supplier terms and controlling the cost base during this period.
The business has in place an existing
In addition, we have now received confirmation from the
We continue to focus on reducing operating expenses and managing our cash flows. Actions include:
- furloughing of over 90% of our colleagues;
- a significant reduction in non-essential capex including deferral of replacement equipment in our manufacturing plant, with investment in a small number of key projects that support the Group's long term strategic objectives;
- new store openings have been reduced to seven in FY21, being those that we are legally committed to opening;
- we have taken a number of steps including negotiating rental payments and having ongoing discussions with landlords to reduce net cash outflow;
- operational spend being restricted to essential for maintaining operations and supporting business continuity;
- we have agreed with HMRC on the deferral of VAT and PAYE/NI;
- stock intake and payment terms are being managed with suppliers; and
- the Board has decided not to pay a final dividend in respect of FY20 to protect the business and its balance sheet at this uncertain time.
Following all the actions taken, the Board is confident that the Group has access to sufficient liquidity, even in the event of a prolonged store closure period.
A key focus for management in response to COVID-19 continues to be the welfare of our colleagues and customers.
With appropriate safety measures and controls in place, we have continued to trade both of our online businesses. While remaining a small part of the group, we have seen significant growth in visitors, conversion and sales. The Cardfactory.co.uk web site has delivered sales growth of 267.5% since the lock-down with Gettingpersonal.co.uk at 57.5%. In response to this increased demand, and to support social distancing, we have established a second fulfilment unit in
Alongside the online activity, we have continued to supply both
With our stores remaining closed, as per government guidance, all of our store colleagues have been furloughed under the Government's Coronavirus Job Retention Scheme. Where required, our Support Centre colleagues are working effectively from home. In preparation for re-opening, we are currently working on changes to our store operations that will help ensure colleague and customer safety. We expect to be able to facilitate appropriate social distancing in the majority of our stores.
To support our most vulnerable colleagues during the COVID-19 pandemic, the
We will make further updates on
Karen Hubbard, Chief Executive Officer
Kris Lee, Chief Financial Officer
James Macey White / Elizabeth Snow / Amber Ahluwalia
This information is provided by RNS, the news service of the
Quick facts: Card Factory
Market Cap: £170.81 m
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