Card Factory has swung to a loss for the past year after store closures slashed its sales by more than a third.
Shares in the retailer dipped on Thursday after it reported a £16.4 million pre-tax loss for the year to January 31, compared with a £65.2 million profit for the previous year.
The group said its stores were closed for an average of five months during the year, hammering sales.
Annual revenues tumbled by 36.9% to £285.1 million for the year, despite the company reporting that trading was “better than expected” after reopening sites following the first and second lockdowns.
Card Factory reopened its estate from April 12 following the third coronavirus lockdown.
It said sales in stores were ahead of its previous reopening performances, although “activity levels settled after initial pent-up demand was satisfied”.
The group added that recent transaction volumes are below the same period in 2019, before the impact of the pandemic, although lower footfall has been “largely offset” by higher spending per customer.
Last month, the retailer also agreed £225 million in new debt facilities to fund its recovery strategy and stimulate further online growth.
Recently appointed chief executive officer Darcy Willson-Rymer said the refinancing has put the company in a strong position to build on its “excellent platform” for future growth.
“Since joining Card Factory in March 2021, I’ve been immensely encouraged by what I have seen and heard,” he said.
“We have successfully reopened our entire store estate following the third lockdown and delivered a reassuring performance in stores, whilst maintaining online momentum.
“Our powerful brand and unique business model means we are well placed to respond positively to the changing retail environment and to unlock the inherent potential in this business.”
Shares in the company were 2.1% lower at 65.42p.