Card Factory (FRA: 0CT) profits have taken a hit due to the weaker pound and increase to the National Living Wage.
The retailer posted a 12.3 percent fall in profits to £72.6 million after it said costs increased £14.6 million in the year to 31 January 2018.
Not only did cost of imports increase due to the weaker pound, but the increase in the National Living Wage from £7.20 per hour to £7.50 per hour for over-25s in April 2017 led to a dent in profits for the retailer.
The National living Wage increased again this month to £7.80.
As the high street faces a “tough consumer environment”, Card Factory continues to grow and opened 50 new stores in the period as well as opening six trial stores in the Republic of Ireland.
Despite the fall in profits, the group’s chief executive officer remained positive and hailed the growth in like-for-like sales.
“We also saw a record-breaking number of customers shopping with Card Factory for both card and complementary non-card products, demonstrating our resilience against a backdrop of High Street footfall decline,” said Karen Hubbard.
“Our store roll-out programme continues, with 50 new UK sites opened in the year, and our Card Factory online business has seen further growth, with increased visitors and sales, and represents a clear opportunity for future growth,” she added.
The high street’s restaurants are also facing the difficult trading period with many, including Jamie’s Italian and Byron Burger announcing store closures.
