Moonpig has posted a £33.3m loss before tax in its opening half results, falling from a profit of £18.9m generated in H1 last year.

In the six months to the end of October, the card retailer still managed to grow its overall revenue by 3.8% against last year, to total £158m in H1.

Moonpig described trading conditions as “difficult” and said it now expects a longer timeline for fully realising the revenue growth potential in its experiences division. The retailer’s fall in H1 profitability was heavily influenced by a £56.7m non-cash charge in its experiences business.

Nevertheless, Moonpig suggested it remains well positioned to deliver “sustained growth” in revenue, profit and free cash flow, driven by a “focus on data and technology”.

The company’s CEO, Nickyl Raithatha, commented: “Moonpig’s performance has been underpinned by robust growth in order volumes, powered by our multi-year investments in technology and innovation and the structural market shift to online.

“Raising our medium-term profit margin target demonstrates our confidence in the outlook for the business.”

Moonpig announced that it would increase its medium-term target for adjusted EBITDA margin from a range of 25% to 26% to a range of 25% to 27%.

The retailer also indicated it would continue to target growth in adjusted earnings per share at a “mid-teens percentage rate”.

However, investment analyst at AJ Bell, Dan Coatsworth, added: “It feels as if Christmas cards have been losing popularity in recent years as people can’t be bothered to send things by post unless they’re parcels.

“With the price of a first-class stamp now costing more than many Christmas cards, there are even greater headwinds for greetings card companies like Moonpig. It’s having to work hard to keep growing and diversifying into other areas like experiences hasn’t gone smoothly.

“Moonpig has had to moderate its growth expectations for this part of its business and that’s caused the share price to fall out of bed.”

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