UK: French Connection slips to FY loss of GBP7.2m
- FY pre-tax loss of GBP7.2m, versus GBP4.6m profit
- Revenue down 8% to GBP197.3m
- Good progress now, says chief executive
Fashion retail business French Connection Group slid to an expected full-year loss in the financial year ended 31 January, thanks to an 8% decline in revenues.
The underlying pre-tax loss excluded one-off items linked to the closure of retail stores and the impairment of goodwill, totalling GBP3.3m.
But chairman and chief executive Stephen Marks said the company had seen an improved performance in UK retail early in fiscal 2013, adding that he expected this to build as the year progresses.
“After a difficult trading year, I am pleased that many of the initiatives we have taken in order to provide a new impetus to sales growth are beginning to show interesting results,” Marks said.
“We are managing the business tightly in order to increase full-price sales volumes, limit discounting, manage inventory levels, control cash and build confidence with our customers.”
Anusha Couttigane, consultant at retail analyst Conlumino, believes French Connections problems stem from the fact its collections are "simply not compelling enough to inspire big spending and this has led to it losing ground in the upper middle market."
"This considerably limits French Connection's demographic appeal, against an economic backdrop where others are able to offer fast fashion at far more competitive prices."
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