Card Factory Plc · LSE:CARD
Card Factory — FY2023 Earnings Presentation
26 slides from Card Factory's earnings presentation, May 3, 2023
Slide 1: Celebrate all life's moments
Celebrate all life’s moments Card Factory plc FY23 Full Year results 3 May 2023
Slide 2: Agenda
Agenda 1. Introduction 2. Financial Performance 3. Strategy Update 4. Summary & Outlook 5. Q&A cardfactery Darcy Willson-Rymer Simon Comer Darcy Willson-Rymer Darcy Willson-Rymer Darcy Willson-Rymer & Simon Comer
Slide 3: Section 1
Section 1 Darcy Willson-Rymer 3
Slide 4: FY23 a year of building momentum
FY23 a year of building momentum • Positive momentum across the business driving revenue growth with cardfactory LFL 1 of +6.7%. • Strong performance of stores and Everyday card ranges. • Compelling customer proposition across card and gifts. • Effective management of inflationary pressures driving
Slide 5: Section 2: Financial Performance
Section 2 Financial Performance Simon Comer cardfactery
Slide 6: A summary of our financial performance
A summary of our financial performance Financial KPIs FY23 FY22 Strong set of financial results ahead of management expectations. Revenue £463.4m £364.4m EBITDA £112.0m £85.6m First full year of trading since FY20 delivered encouraging Profit before tax (PBT) £52.4m £11.1m PBT result: £41.3 million
Slide 7: Momentum in store sales
Momentum in store sales cardfactory LFL since fully re-opening 16.0% (vs FY22) Strong performance in stores +7.6% LFL compared to FY22. Total Store sales for FY23 slightly ahead of pre-pandemic levels 12.0% with LFL of -0.3% compared to FY20. 8.0% Approximately two-thirds of LFL growth driven by tar
Slide 8: A strategic focus on partnerships and online
A strategic focus on partnerships and online Partnerships Sales - £m • 10% increase in sales year-on-year - robust performance of existing partnerships. £5.0m £4.5m • 3% increase in points of sale – now selling through 949 Partnerships £5.6m partner locations. £3.1m • Investment in team and capabili
Slide 9: Price and cost control delivering margin improvement
Price and cost control delivering margin improvement Higher sales and costs reflect increased trading days FY23 FY23 FY22 FY22 YoY compared to FY22 – margins improved through a % of Revenue % of Revenue combination of targeted price increases, efficiency gains and inflation mitigation. Sales £463.4m
Slide 10: Substantial reduction in Net Debt from FY20 to FY23
10 Substantial reduction in Net Debt from FY20 to FY23 Year Net Debt Leverage1 £m FY20 (143.1) 1.8x Includes £10.8 million of rent payments deferred during covid FY21 (107.7) 2.4x pandemic FY22 (74.2) 0.9x FY23 (57.2) 0.5x 1. Leverage calculated as Net Debt (excluding lease liabilities) / EBITDA. Ne
Slide 11: Free cash flow reflects post Covid-19 normalisation
Free cash flow reflects post Covid-19 normalisation FY23 FY22 Change Operating cash flow before working £m £m £m capital significantly increased reflecting Profit before tax 52.4 11.1 41.3 improved trading performance. Net finance expense 11.4 20.5 (9.1) • Pre-tax operating cash conversion (96%) 1 D
Slide 12: Enhanced liquidity and pathway to dividends
Enhanced liquidity and pathway to dividends Debt Facilities • £150m facilities agreed April 2022 - £100m RCF, £11m Term Loan ‘A’, £19m Term Loan ‘B’, and £20m CLBILs. • Scheduled term loan and CLBILs repayments commenced January 2023 (£6m). Liquidity • Reduction in net debt and leverage – strengthen
Slide 13: A strong financial performance
A strong financial performance • A strong set of financial results underpinned by positive trading performance and +6.7% LFL sales. • Improved margins delivered by successful management of inflationary pressures – targeted price increases, hedging and productivity actions. • Refinancing delivered, s
Slide 14: Section 3
Section 3 Darcy Willson-Rymer 14
Slide 15: Opening Our New Future
Opening Our New Future cardfactery cardfactory, we make sharing in and celebrating life's moments special and accessible for everyone Scalable Creative Manufacturing Technology Central Model Insight driven product, design Ability to scale up production Enabling greater efficiency, more Driving Org &
Slide 16: Significant milestones achieved in card and gifts
Significant milestones achieved in card and gifts Leadership in card - FY23 milestones: • Range development and pricing strategy drove revenue growth. • Permanent 3 for 2 mechanic on general card range delivered sales growth. • Introduced expanded diversity across card ranges. Gifting opportunity -
Slide 17: Foundations in place for omnichannel and digital growth
Foundations in place for omnichannel and digital growth First Omnichannel proposition live – FY23 milestones: • Successful Click & Collect trial across 87 stores. • AOV 16% higher than online average. • 7% of customers purchased an additional item in store. • UK nationwide rollout completed at end o
Slide 18: Successful trial leads to new Store Evolution Programme
Successful trial leads to new Store Evolution Programme Extensive UK&I Store footprint - FY23 milestones: • Successful Model Store trial informing development of Store Evolution Programme which involves 3 components 1. Space realignment - reallocating space so that slightly more priority for gifts t
Slide 19: Positive progress on partnerships
Positive progress on partnerships New partnership agreement signed: • Long-term master franchise agreement signed with Middle East-based, Liwa, who will act as our exclusive franchise partner in the region, to open c. 36 cardfactory branded stores in the Middle East. Acquisition of SA Greetings: • F
Slide 20: Updates underway to our five-year ESG strategy and roadmap
Updates underway to our five-year ESG strategy and roadmap ESG - FY23 Milestones: • Five-year ESG strategy update and roadmap development underway, including refreshed materiality assessment and assessment of our scope 3 greenhouse gas emissions. • Entered into partnership with the Woodland Trust. •
Slide 21: Section 4
Section 4 Darcy Willson-Rymer 21
Slide 22: FY23 in summary
FY23 in summary • Encouraged by continued positive momentum in performance. • Demonstrated our ability in FY23 to mitigate inflationary headwinds. • Investment in people, systems and IT infrastructure to deliver on our strategy. • Strategy delivery underway with significant progress now beginning to
Slide 23: Confident outlook for continued strategic and financial progress
Confident outlook for continued strategic and financial progress • Expect performance for FY24 to reflect continued progress on our strategic growth initiatives. • Trading since year-end has been encouraging and slightly ahead of the Board's expectations. • Robust performance across both Valentine’s
Slide 24: Section 5
Section 5 Darcy Willson-Rymer & Simon Comer 24
Slide 25: Forward-looking statements
This announcement contains certain forward-looking statements with respect to the financial condition, results of operations, and businesses of Card Factory plc. These statements and forecasts involve risk, uncertainty and assumptions because they relate to events and depend upon circumstances that
Slide 26: cardfactory
cardfactery celebrate all life's moments