Company Announcements

An ESG strategy has been devised with five key work streams. Management will focus on these to achieve the ambition of growing the business in a socially and environmentally responsible way.

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.

Broader delivery of the overarching commercial strategy must ensure continual 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 strategy in place which fully articulates cardfactory brand proposition and strategic framework to elevate the brand's key attributes and to create 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.

To minimise these risks, we have successfully completed the initial implementation phase, which encompassed finance and master data without any material disruption.

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.

The IT strategy implementation includes ongoing specialist support for legacy systems and migration to new systems, including the ERP implementation with dedicated teams in place to manage the transition.

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.

A business continuity and disaster recovery plan is in place, which includes the use of alternative suppliers for any impacted production processes.

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.

Processes for suppliers to agree to appropriate standards, which are subject to regular audit and inspection by cardfactory teams (or receipt of alternative adequate independent report) to validate compliance, with a strict '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.

A business development team has been formed to build relationships with existing partners and develop a pipeline of future 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.

Suppliers:

- Diversifying the supply base by bringing more production back to the UK while also exploring other geographical territories.

- Buyers have extensive industry knowledge, know of alternative suppliers if mitigation needs arise and manage any supply issues or problems.

Customers: Moving supply to new territories and using UK-based suppliers (non-exclusive product) will mitigate the supply issue at the shelf edge, but could potentially drive increased cost, with price elasticity assessments to provide insights on consequences of future price increases.

Geographies and governments:  Continual review of the import tariff duties and 'live' government legislative changes to ensure we are always sourcing from the best source to support the overall business.