French Connection sees sales rise

Fashion retailer French Connection has narrowed half-year losses after returning to retail sales growth despite trading remaining tough on the high street.

The group reported pre-tax losses of £4.7 million for the six months to July 31, against losses of £15.1m a year ago.

French Connection reported a 1.4% rise in like-for-like retail sales across the UK and Europe – a marked improvement on the 7% drop posted a year earlier.

But total group revenues fell 12.2% to £51m – or 14% lower with currency movements stripped out – as it continued to trim its store estate in the face of higher rent costs and changing shopping habits.

It closed 13 company-operated stores and concessions – including its Dundee store – as well as 19 franchised and licensed outlets in the six months, leaving it with 90 and 185 respectively.

The group also said talks remain “ongoing” with a number of interested parties over the potential sale of the business and has extended the process until the end of its financial year in January.

“We believe that further time is required to bring the process to a successful conclusion,” it said.

Founder Stephen Marks, who is the group’s chairman and chief executive, said its turnaround efforts were paying off, but cautioned over ongoing “challenging” trading.

He said: “There is no doubt that progress has not been helped by the trading conditions in which we operate in the UK, although our retail performance has been resilient, overall the wholesale business is strong and we continue to see good stability in the licence income.”

Shopping habits are changing.