UK: Men's wear drags down French Connection outlook
UK high street fashion brand French Connection Group says it has got off to a good start at the beginning of its financial year, but aired caution for the year ahead, particularly in its men's wear business.
In an interim statement covering the period from 1 February to 17 May 2008, the retailer said the challenging economic conditions affecting retail markets in the UK and US "appear to be continuing and in particular affecting men's wear".
This was despite the encouraging performance of the French Connection ladies' wear ranges, it added.
Sales in the UK/Europe have been broadly flat since the beginning of the fiscal year, both in total and on a like-for-like basis. Its French Connection ladies' wear and Toast units showed growth over last year.
In North America, the company's retail business' like-for-like sales were broadly flat on last year too, but margin deteriorated due to additional promotional discounting.
Overall retail sales volumes fell 9% following the closure of three stores last year - representing a reduction of 10% in the total space traded.
Sales in North America wholesale business were well ahead of last year, it said, reflecting strong forward orders for spring/summer 2008, while UK/Europe wholesale growth was limited.
"As widely reported, the retail fashion markets in both the UK and US have been particularly difficult during the first weeks of the new financial year," the company added.
"However, the Board believes that the French Connection brand has performed well during this period, reflecting the improvements made in the business during the past year."
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