June 2, 2020 / 7:26 AM / a month ago

UPDATE 1-Card Factory plans to reopen 10% of its stores as lockdown boosts online sales

(Adds details on online sales, outlook, analyst comments)

June 2 (Reuters) - Greeting card retailer Card Factory said on Thursday it had seen online sales surge as much as threefold in Britain’s coronavirus lockdown and would open 10% of stores from June 15, while warning that business would suffer from social distancing.

The company said it was unable to give an outlook for the current financial year due to the uncertainty caused by the coronavirus crisis, but is planning a further shift towards online sales and would lay out plans for expansion more fully in July. It does not expect to pay dividends for the 2021 fiscal year.

The Wakefield-based company, which has more than 1,000 stores in the UK and Ireland, said social distancing would impact the number of transactions it can deal with in some shops, but that it was looking at ways to process these to optimise sales.

Card Factory said earlier this month that it secured access to the Bank of England’s coronavirus aid scheme, furloughed more than 90% of its staff, suspended dividend and was negotiating with its landlord to ride out the crisis.

The company, which also makes gift dressings and party products, said it had received personal protective equipment.

Like-for-like sales for cardfactory.co.uk have jumped 302% since the lockdown and 68% for gettingpersonal.co.uk.

“We expect the strategy to focus on new growth channels, such as wholesale, and optimising its portfolio,” Investec analysts said. “We believe CARD has sufficient capital to ride out a prolonged shutdown”.

Shares in Card Factory, which jumped nearly 17% at the open, reversed course to trade down 2.4% by 0719 GMT. (Reporting by Tanishaa Nadkar in Bengaluru; Editing by Subhranshu Sahu)

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