Group revenue at French Connection fell by 2.4% to £58.1m in the six months to 31 July, which the retailer blamed on a reduced store portfolio and ‘tough retail trading’.
Like-for-like sales across the UK and Europe slipped by 7% but wholesale revenue was up by 6.2%. Underlying operating loss before tax was reduced to £5.5m, compared to £5.9m the previous year.
The business said gains on the sale of Toast in April for £11.7m to Bestseller were offset by provisions for “onerous retail leases” and debt impairment.
French Connection had a closing cash position of £12.8m compared to £6.7m in 2017 boosted by the sale of Toast.
Chairman and chief executive Stephen Marks said the business was on target to return to profit before the end of the year.
“I am pleased that the changes we have made around the business over the last couple of years continue to move us forward. There is no doubt that progress has not been helped by the trading conditions in which we operate in the UK, although we can take great confidence from the performance of the wholesale business and the stability of the licence income.
“The order books we have provide a clear outlook for the second half of the year in wholesale, although retail continues to be challenging. We remain on target to return the business to profitability this year and we will be doing everything we can to ensure that happens.”
French Connection closed two stores over the six month period and opened one new concession.