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19 September 2012 10:06
Fashion retailer French Connection slumped £6.3 million into the red today as it warned shareholders its recovery "is likely to take some time".
The group vowed to improve ranges, sharpen prices and close loss-making stores following a review of its UK retail business, which suffered a 9.5% fall in sales in the past six months to July 31st as well as weakened margins amid heavy discounting.
The group is thought to be considering the closure of up to 15 of its 70 stores in the UK.
Its "disappointing" performance in the UK and Europe meant it slipped to a pre-tax loss of £6.3 million in the six months to July 31st, compared to a profit of £700,000 in the previous year.
With the company also expecting to make a full-year loss, it scrapped its dividend payment but said it hopes that efforts to revitalise the business will begin to pay off within two years.
Founder and chief executive Stephen Marks, who has called conditions the worst he has known in 40 years of trading, said: "We recognise that the route to sustained recovery is likely to take some time but we are committed to building on French Connection's core strengths."
