// French Connection’s losses narrow despite revenue decline
// The retailer attributed the decline to temporary store closures and a reduced retail portfolio
French Connection has seen its first half group revenue decline by 21.2 per cent to £40.2 million compared to the same period two years ago following the impact of Covid-19 related store closures.
In the six months to 31 July, the fashion retailer narrowed its underlying operating loss to £0.9 million from £3.6 million in 2019 after it benefited from a strong performance within its wholesale business in the US and UK.
The retailer attributed the decline to temporary store closures and a reduced retail portfolio and said that the closures helped contribute to a £15.2 million reduction in overheads during the period as it seeks to shore up its balance sheet.
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While retail revenue fell to £11.4 million from £23.8 million in 2019, ecommerce sales grew to £5.8 million from a previous £5.3 million with the retailer adding that online growth was achieved in both the UK and US despite reduced levels of promotion in the period.
French Connection chair and chief executive Stephen Marks, who will retire from the business following the acquisition, said: “I am pleased that the improvement in business we saw in the early part of the period has continued throughout the first half of the financial year.
“Wholesale in both the UK and the US has performed well, with a good outcome to the summer season.
“Over the last five years, French Connection has made significant progress in its plans to rationalise the size of its store portfolio and to return the group to profitability.”
Last week, it was announced that French Connection had agreed a £29 million takeover by a consortium of bidders that included its second largest shareholder Apinder Singh Ghura, Amarjit Singh Grewal and KJR Brothers Limited.
In a statement today, Marks said: “The board has concluded that the offer being made by MIP Holdings Ltd is fair and reasonable and recommends that all shareholders accept.
“Following completion of the transaction, I will retire from French Connection. This is an appropriate time for me to step back from the business that I founded in 1972, and I would like to take this opportunity to thank all our people for their contribution to our achievements over the years. I wish them all every success in the future.”