REG - Card Factory PLC - Annual Financial Report & AGM Noticce
19/05/2023 14:48
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RNS Number : 0789A Card Factory PLC 19 May 2023
19 May 2023
Card Factory plc
Annual Financial Report and Notice of AGM
Card Factory plc ("cardfactory" or the "Company") announces that it has
published its Annual Report and Accounts for the year ended 31 January 2023
and Notice of the Company's 2023 Annual General Meeting.
The Annual General Meeting is to be held at the Company's registered office,
at Century House, Brunel Road, Wakefield 41 Industrial Estate, Wakefield, WF2
0XG at 11.00 a.m. on Thursday 22 June 2023.
Copies of the documents listed below have been posted to shareholders on
Thursday 18 May 2023:
1. Annual Report and Accounts 2023;
2. Notice of 2023 Annual General Meeting; and
3. Form of Proxy for the 2023 Annual General Meeting.
The Annual Report and Accounts and the Notice of the 2023 Annual General
Meeting will also be accessible later today via the Company's investor
relations website www.cardfactoryinvestors.com
(http://www.cardfactoryinvestors.com) . In compliance with LR 9.6.1, the
Company has today submitted electronic copies of the above documents to the
National Storage Mechanism appointed by the Financial Conduct Authority and
these will shortly be available for inspection at
https://data.fca.org.uk/#/nsm/nationalstoragemechanism
(https://data.fca.org.uk/#/nsm/nationalstoragemechanism) .
cardfactory's preliminary results announcement on 3 May 2023 (which is
available via the Company's investor relations website referred to above)
included, in addition to the preliminary financial results for the year ended
31 January 2023, information on important events that occurred during the year
and their impact on those financial results. That information, together with
the information set out in the Appendix below is provided in compliance with
the requirements of DTR6.3.5(2)(b). This information is not a substitute for
reading the full Annual Report and Accounts for the year ended 31 January
2023.
For further information:
Ciaran Stone, Group General Counsel and Company Secretary Tel: 01924 839150
Card Factory plc
ENDS
Appendix
Principal Risks and Uncertainties
The principal risks and uncertainties facing the cardfactory group (the
"Group") are set out below, together with details of how these are currently
mitigated. For further information on how the Group manages risk, see pages 58
to 62 of the Strategic Report and also pages 72 and 73 of the Corporate
Governance Report within the Annual Report and Accounts 2023 ("Annual
Report").
Risk Description Mitigation
Strategic Risks
ESG compliance and Failure to meet requirements of institutional investors, customers and other An ESG strategy has been devised with five key work streams. Management will
stakeholders when it comes to ESG requirements, including provision of focus on these to achieve the ambition of growing the business in a socially
climate change sustainable products and reducing waste and plastics (includes climate change and environmentally responsible way.
risks).
risks
Various actions in environmental and social have been implement. Please refer
to the ESG section of the Annual Report on pages 36 to 43 for further actions
being taken.
Adapting to customer preferences Failure to anticipate and adapt to changes in customer preferences and Broader delivery of the overarching commercial strategy must ensure continual
shopping habits, market dynamics and competitor activity-channel shift. adaptation to changing customer preferences; in store, online and through our
business partners. Historically, the business has had limited access to
meaningful customer and marketing insight to drive improved decision making.
The creation of a marketing and insight function has improved decision making.
The commercial planning process continually reviews and responds to changing
customer purchasing behaviour.
As the business becomes fully omnichannel, the customer demands for fulfilment
and service will increase as a connected, seamless experience becomes an
expectation rather than a desire. In response, Click & Collect and
multi-ship have been rolled out. Future developments are being scoped.
Brand customer Failure to manage and promote the brand which could result in loss of market Brand strategy in place which fully articulates cardfactory brand proposition
share. and strategic framework to elevate the brand's key attributes and to create
experience clarity around the omnichannel proposition with cross channel campaigns being
developed to support awareness and growth including celebrate life's moments.
We have significantly improved customer insight and data which is shaping our
thinking and decision making across the business and we have invested in,
trialled and launched a customer Service Excellence programme, which will
continue to evolve.
Market data shows that cardfactory has been successful in retaining and
attracting customers through the strength and value for money we offer coupled
with an increase in range and sales of gifts and celebration essentials.
Additionally, the communication plan has a focus on investor relations with an
increased focus on working with Corporate Affairs agency to proactively tell
the cardfactory story. See the 'Our brand' section on pages 12 and 13 of the
Annual Report for further information on our activities.
Operational Risks
Enterprise Resource Planning (ERP) Undergoing a design and phased implementation of a new ERP systems to replace To minimise these risks, we have successfully completed the initial
aging core IT infrastructure. This process carries inherent risks, including implementation phase, which encompassed finance and master data without any
implementation potential business disruption, data loss, inability to achieve expected material disruption.
benefits, and failure to provide the necessary foundation for executing our
strategic plan. Key aspects of this plan include developing an omnichannel
customer experience, enhancing engagement with retail partners, and driving
operational efficiencies in stores. We have also restructured the project to adopt a more incremental approach,
which allows for smoother transitions between phases, reduced reliance on
vulnerable legacy systems during peak trading seasons, and enables the
achievement of critical strategic plan components. Furthermore, we have
increased our focus on business process engineering, dedicated resources and
change management strategies to support a successful ERP implementation.
IT infrastructure Unsupported and legacy software, some of which is subject to material The IT strategy implementation includes ongoing specialist support for legacy
tailoring, requires ongoing support to maintain functionality and significant systems and migration to new systems, including the ERP implementation with
and security transactional volumes. There is a reliance on IT systems to support all dedicated teams in place to manage the transition.
operations, which could be exposed to cyber risk.
Cyber expertise is employed within the business and appropriate cyber controls
are in place. Plans designed to continue to address multiple cyber risks,
alongside further risk mitigations arising from replacement of legacy systems,
are also in place.
Business Prolonged loss or server disruption to Printcraft print and production A business continuity and disaster recovery plan is in place, which includes
facilities, web fulfilment centre and supply chain. the use of alternative suppliers for any impacted production processes.
continuity
In relation to online fulfilment, any short-term outages can be mitigated by
adjustment of delivery times for online orders. Business continuity plans are
in place, which include the use of third parties.
Planning permission has been obtained and groundworks completed on an
additional building to create capacity for online fulfilment, to relieve
capacity constraints.
Supplier CSR breach Supplier CSR breach resulting in a potential breach of legislation (eg. Modern Processes for suppliers to agree to appropriate standards, which are subject
Slavery, Anti Bribery & Corruption) and for products supplied (eg. Safety to regular audit and inspection by cardfactory teams (or receipt of
and labelling standards), which could damage cardfactory's reputation and alternative adequate independent report) to validate compliance, with a strict
reduce sales. 'no audit - no order' policy adopted. Testing and pre-shipment sampling of
production models is being undertaken.
All product testing and quality control inspections is undertaken by
authorised accredited providers. A dedicated quality control team is in place
to test pre-shipment sampling of production models.
The risk profile for most suppliers to Getting Personal is significantly
lower, with limited supplies from the Far East. Plans are being developed to
extend the quality control and technical teams' scope to include these
suppliers with adoption of appropriate requirements to mitigate risks.
Retail partner cardfactory may not realise the growth in profitable revenue from retail A business development team has been formed to build relationships with
partners, which is a significant component for future growth of the business existing partners and develop a pipeline of future partners.
exposure and the brand or reputation could be damaged by the actions of retail
partners.
Brand standard requirements are in place to provide a clear framework for
partners, with regular reviews adopted. Enhanced requirements will be
incorporated in any future retail partner requirements.
Financial Risks
Geopolitical Geopolitical instability leading to Suppliers:
instability restrictions on trade - Diversifying the supply base by bringing more production back to the UK
while also exploring other geographical territories.
Suppliers: Operating with a supply base whereby we have the total business or
specific categories solely dependent on - Buyers have extensive industry knowledge, know of alternative suppliers if
mitigation needs arise and manage any supply issues or problems.
one supplier, region or country carries significant stock supply risk. China
remains our biggest supply route. Customers: Moving supply to new territories and using UK-based suppliers
(non-exclusive product) will mitigate the supply issue at the shelf edge, but
Customers: Restrictions on supply from certain countries may impact could potentially drive increased cost, with price elasticity assessments to
availability and retail selling prices. provide insights on consequences of future price increases.
Geographies and governments: New legislation and import tariffs may force Geographies and governments: Continual review of the import tariff duties
resourcing decisions. and 'live' government legislative changes to ensure we are always sourcing
from the best source to support the overall business.
Directors' Responsibility Statement
The Annual Report and Accounts 2023 contains a statement of directors'
responsibility by Darcy Willson-Rymer, Chief Executive Officer, by order of
the Board in the following form:
"We confirm that to the best of our knowledge:
· the financial statements, prepared in accordance with the
applicable set of accounting standards, give a true and fair view of the
assets, liabilities, financial position and profit or loss of the Company and
the undertakings included in the consolidation taken as a whole; and
· the Strategic Report includes a fair review of the development
and performance of the business and the position of the issuer and the
undertakings included in the consolidation taken as a whole, together with a
description of the principal risks and uncertainties that they face.
We consider the Annual Report and Accounts, taken as a whole, is fair,
balanced and understandable and provides the information necessary for
shareholders to assess the Group's position and performance, business model
and strategy."
Related Party Transactions
Details of the only material transactions with related parties during the
financial year ended 31 January 2023 are set out in note 28 of the financial
statements on page 142 of the Annual Report and Accounts.
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