Moonpig reports strongest ever trading week ahead of Valentine’s Day

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Moonpig Group PLC (LON:MOON) said the week ahead of Valentine’s Day was the strongest trading week in its history as it said purchasing activity remained “unusually elevated” during the coronavirus (COVID-19) lockdown.

In a trading update, the online greeting card and gifts retailer said the significant increase in demand seen in the first half of its current year had continued through the third quarter, adding that it is also seeing a temporary increase in average order values as more customers attached gifts to their purchases.

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The firm also said that it has further increased marketing activity to accelerate customer acquisition, and as a result, it now expects revenues for the financial year to April 30 to be double the £173mln figure from the prior year.

Meanwhile, Moonpig said it has continued to invest to deliver the higher levels of orders from customers, which has resulted in higher incremental costs and capital expenditure due to higher temporary staffing levels throughout its supply chain and by the partial shifting of its production mix to the UK following a lockdown in Guernsey.

The company also said it expects the underlying earnings (EBITDA) margin for the 2021 financial year to be in line with the margin in 2020, and that while the higher levels of purchases are expected to moderate as lockdown measures ease, its guidance for the financial year to April 30, 2022, remains “broadly unchanged.”

The update sent the shares up 3.5% to 449.5p in early trading on Thursday.

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