French Connection founder Stephen Marks today said the fashion brand appeared to be “back on track” following a major restructuring effort.
The group reported a slender half-year profit from the businesses it intends to retain and said it was confident of progress over the year as a whole.
As part of moves to slim down the group, French Connection is shutting loss-making stores in the US alongside the closure of its Japanese business and some European retail outlets. It has also sold its loss-making Nicole Farhi brand.
The retained businesses increased turnover by 4% to £96.2m (€115m) in the six months to July, while overheads were reduced further to generate pre-tax profits of £200,000 (€239,000), compared with losses of £5.4m (€6.4m) a year earlier.
Mr Marks, who is company chairman, told shareholders: “I am pleased with the substantial improvement in operating results in the first half of the year and I am confident that French Connection is now back on track.”
With the restructuring now largely complete, he said the company was at the beginning of a new period of growth.
The shake-up has left French Connection with its UK and European retail and wholesale operations, the Great Plains wholesale-only ladieswear range and Toast, its mail order fashion and homewares brand.
It is also planning to keep 20 stores in North America and today announced a licence agreement for the use of the “UK Style by French Connection” name in the US by a Hong Kong-based consumer goods export firm. The products will be sold exclusively through Sears department stores.