Apr 24, 2015
warns on full-year results French Connection
Apr 24, 2015
British fashion retailer French Connection Group Plc said it expected full-year results to be below market estimates as the previous year's challenging trading conditions continued through Easter.
Retail sales, which account for about 60 percent of group revenue, is expected to be "materially" lower in the first half, the company said.
Shares in the company, known for its FCUK brand, fell 22.5 percent to their lowest since February 2014 on the London Stock Exchange on Friday morning.
The stock has lost 30 percent in value this year until Thursday.
British retailers had a tough time last year partly due to a mild autumn that hit sales of winter fashions. Muted wage growth in Britain has also forced consumers to keep spending under control.
French Connection, which has been attempting a turnaround after years of underperformance, is trying to win customers by redesigning product ranges and closing unprofitable stores.
The London-based company, whose competitors include SuperGroup Plc and Ted Baker Plc, said it expected to close another 7 stores during the current year.
Terming the trading update "disappointing", Cantor Fitzgerald analyst Freddie George reduced his forecast to a pretax loss of 3.5 million pounds from a profit of 0.5 million pounds for the year ending Jan. 31, 2016.
French Connection said wholesale revenue, which comes from its sales to retailers in 60 countries around the world, was in line with expectations, with forward orders up year-on-year. Its licensing business also continued to perform strongly.
The company said its current cash levels were 9.9 million pounds with no debt, compared with 12 million pounds a year earlier.
French Connection shares were down 21.5 percent at 41.81 pence by 0742 GMT.
£1 = $1.51
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