10th Mar 2020 10:49
(Alliance News) - Struggling fashion brand French Connection on Tuesday reported a narrowed full-year loss, but sales fell and its shares tumbled.
The stock was trading 13% lower at 16.10 pence each. French Connection shares saw 62% of their value wiped out over the past 12 months.
In the year ended January 31, French Connection's revenue from continuing operations fell 11% to GBP119.9 million from GBP135.3 million.
Its pretax loss was trimmed to GBP7.3 million from GBP8.6 million. Operating expenses were 20% lower at GBP57.2 million from GBP71.6 million.
Like-for-like sales in the UK & Europe were down 2.5% year-on-year, a reflection of tough "trading conditions on the High Street generally in the second half of the year".
Total retail revenue for French Connection slumped 20% to GBP46.7 million, with Whoesale revenue down 4.8% to GBP73.2 million.
French Connection in January said trading was particularly difficult in the fourth quarter, a period which included the pivotal Christmas trading spell.
Chair & Chief Executive Stephen Marks said: "The performance this year has not been as anticipated and we are not being assisted by the continued difficult trading conditions in the UK and potential uncertainty due to the covid-19 coronavirus. I am however, pleased with the continued good performance of the wholesale business in the US and we have good forward order banks in the UK to be delivered during the first half of the year. The initial reaction to the winter ranges has been positive, particularly at our recent New York Fashion Show.
"We believe the trading landscape in the UK is unlikely to improve in the short term and this has a potential impact on both the retail and wholesale businesses. Against this background we are working hard to ensure we are operating as efficiently and cost effectively as possible while working closely with all our trading partners to maximise business with them."
Back in October 2018, French Connection said it was considering the sale of the company.
However, in January 2020, it took itself off the shelf and said it was no longer looking for a buyer. French Connection at the time said it had completed a "strategic review" and would focus on cutting costs, "right sizing" its store portfolio, and boosting investment in its online offering.
By Eric Cunha; [email protected]
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