French Connection vows to revive UK stores after profit fall
Fashion retailer French Connection saw pre-tax profits fall to £5 million for the year to 31 January from £7.3 million in the previous year.
In addition, the retailer's UK stores slumped to an £8.2 million loss as it faced higher production costs and cut margins to maintain sales.
Founder and chief executive Stephen Marks said it had been the most difficult winter season he had seen during all his years in the business adding that the company was taking action to improve the performance of its UK operation.
Marks said: "We are very aware that there will be no quick solutions and that changes we make will take time to have an impact.
"We are working very hard on improving the performance of the retail stores, although clearly the state of the UK economy is not helping the position."
The UK/Europe wholesale channel fared better with a 17% increase in revenue on last year. The company generated an operating profit of £3.3 million in North America, an improvement over previous years.
French Connection said its licensees in Asia and Australia continued to perform well and its joint ventures in Hong Kong and China both achieved strong growth in like-for-like sales.
Furthermore, brand licensing income grew strongly, increasing by 47% to £8.5 million from £5.8 million last year.
The company is planning further expansion of its international operations in the coming year and will launch a range of premium womenswear this spring.
Marks concluded: "I expect that the UK retail environment will remain subdued over the next twelve months and we are planning accordingly. We will, however, continue to work hard to improve our financial performance."
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