Substantial Declines at Card Factory Despite Revenue Increase – Bright Spots for Raspberry Pi and Smiths Group

Card Factory reports a significant decline in adjusted earnings for the first half of the year, down 34.4% to £14.5 million. This decline is attributed to substantial increases in the national minimum wage, freight cost inflation, and strategic investments. Simultaneously, the company’s revenue rose by 5.9% to £233.8 million, including a 6% growth in sales of gifts and celebration items. Card Factory continues to expect to benefit from productivity and efficiency gains in the second half of the year. CEO Darcy Willson-Rymer emphasized, "As we enter the second half and the crucial Christmas trading period, our full-year expectations remain unchanged, and we continue to focus on managing inflationary pressures within the business." Raspberry Pi performed better, finishing the first half surprisingly profitably. The budget computer company was one of the few notable IPOs on the London Stock Exchange in June. The Cambridge-based firm, which raised £178.9 million from its IPO, achieved a gross profit of $34.2 million (£25.6 million), a 47% increase in the first six months of the year. CEO Eben Upton called the stock market listing a turning point for the first half of the year and added that the sell-off of the latest flagship Raspberry Pi 5 and the production launch of the RP2350 microcontroller were extremely successful. The Smiths Group also presented encouraging results and announced two North American acquisitions. The company recorded a 5% increase in operating profit to £526 million and raised the dividend by 5.2% to 43.75 pence per share. Alongside these positive business figures, the firm plans to acquire Modular Metal Fabricators and Wattco for a total of up to £110 million and integrate them into the Flex-Tek business. This underscores the company’s optimistic outlook, with anticipated revenue growth of 4% to 6% and continued margin improvements for the current fiscal year. Asian markets also saw significant gains after the People's Bank of China announced stimulus measures to support the 5% GDP growth target. The Hang Seng Index and the Shanghai Composite both rose by over 3.5%. This, together with a positive performance on Wall Street, allows the FTSE 100 Index to start trading on a more optimistic note.