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French Connection to sell Nicole Farhi and cut US stores
French Connection said it will close the majority of its loss making operations in the US and sell its Nicole Farhi brand following a strategic review.
The changes will include exiting the Japanese market, and the closure of the majority of the under-performing French Connection retail stores in the US at a one-off cost of £6.5 million but leading to an annual reduction in losses of £3.2 million.
The company said will receive up to £5m for the Nicole Farhi business which made operating annual losses of £5.6m. The sale may be subject to shareholder approval.
French Connection said once the changes are implemented, the group is expected to be profitable and cash generative and "are well positioned to benefit from any recovery in the economy."
For the year the group said losses widened to £24.9m from £16.4m while revenue rose to £214.3m from £213.6m.
"In a very difficult economic environment, our ongoing businesses have performed reasonably in the past year," said chairman Stephen Marks
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