‘Card Factory has 16 years of unbroken like-for-like sales growth’; Richard Hayes, chief executive, says the retailer has opened a shop a week for the past decade; The average British person buys 30 greetings cards a year

‘Card Factory has 16 years of unbroken like-for-like sales growth’

Richard Hayes, chief executive, says the retailer has opened a shop a week for the past decade

Private equity group Charterhouse bought Card Factory for £350m in 2010 and is understood to be working with UBS and Morgan Stanley on an IPO Photo: PA

By Graham Ruddick

10:00PM GMT 29 Mar 2014

The average British person buys 30 greetings cards a year, according to Richard Hayes, the chief executive of Card Factory.

This includes an average of 10 at Christmas and then a series of cards throughout the year for birthdays, special events and annual celebrations such as Mothering Sunday.

It is quite a statistic and one that demonstrates why Card Factory has been able to expand from a single store in Wakefield 17 years ago into a chain with 700 shops.

“Card buying in the UK is not replicated in the rest of Europe,” Mr Hayes says in his first newspaper interview. “I am pretty sure the UK buys more cards per person than anywhere else. Culturally, it has built up over 100 years and is ingrained in our culture.”

Nonetheless, despite the popularity of greeting cards, a high street card retailer is not an obvious candidate to float on the stock market.

Many investors are still licking their wounds from Clinton Cards, which fell into administration in 2012 after opening too many stores on Britain’s high streets. In 2014, investors are piling into supposedly high-growth technology stocks such as AO and Boohoo.

However, Mr Hayes insists Card Factory has a compelling story. It is a value retailer, selling greeting cards at 59p, 89p and 99p. “Card Factory is value for money. We try to push the boundaries of quality and price — Clinton operates at the premium end of the market,” he says. Sales numbers and the crowd of customers in the Bromley store, in south-east London, where we meet, suggest Card Factory’s strategy is working.

It has opened one store a week for the past decade and Mr Hayes believes it could expand to almost 1,100 across the UK.

The company now generates annual revenues of £300m and earnings before interest, taxes, depreciation, and amortisation of £74m.

Private equity group Charterhouse bought Card Factory for £350m in 2010 and is understood to be working with UBS and Morgan Stanley on an IPO. Mr Hayes declines to comment on the float, but insists the firm has a bright future. “Card Factory has 16 years of unbroken like-for-like sales growth, it has rolled out a store a week for the last 10 years, and is in a resilient market,” he says.

“Greeting cards have been lightly touched by online — only 3pc of the volume is online, which is still a physical product. I have yet to meet a lady who is so organised that she goes online 30 times a year [to buy cards], and pays £3 a card.”

The key to Card Factory’s growth, however, is not just that fact that it undercuts Clinton and other retailers. Card Factory manufactures its own cards from its base in Yorkshire.

Card Factory was founded in 1997 by husband and wife team Dean and Janet Hoyle. Mr Hayes was initially Card Factory’s relationship banker with Natwest. He was made finance director 11 years ago. When Mr Hoyle stepped down in 2008 to become chairman of Huddersfield Town Football Club, Mr Hayes became chief executive. Mr Hoyle remains on the board as a non-executive director.