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Rise in franchise sales lends hope to French Connection

French Connection franchisees are achieving about 10% like-for-like growth according to sources in the industry, suggesting the company is experiencing a retail recovery.

The figures come one week ahead of the company's full-year results due next Wednesday, with analysts forecasting an improved trading performance.

Leading City analysts have predicted wide-ranging figures on broker expectations for pre-tax profit for the year to January 31, from £700,000 to £5.8 million, with an average of £3.7m

Pali International analyst Nick Bubb told Drapers: "I see no reason why it should beat my full-year estimate of pre-tax profit of £4.5m. The second half has probably gone reasonably well, but we assumed it would, after the first half loss. The real focus will be on the wholesale order book and retail trading so far this season."

Retail trading at the chain's 14 UK franchise stores and five in the Republic of Ireland is going well, according to industry sources.

Richard Clews, managing director of Collections Group and a French Connection franchisee in Jersey for eight years, said sales at his store were up 21% on a like-for-like basis. He added: "It is obviously very early in the season and not time for the champagne yet, but things are clearly on the up."

The improvement comes over the past four seasons following a drop in trading for autumn 05.

Julian Jordan, a French Connection franchisee for eight years in Northern Ireland, said that his three stores and three concessions had faced a tough time in autumn 05 and spring 06.

"The bubble burst on the back of the FCUK branding, probably slightly later here in Northern Ireland than on the mainland. However, now product and trends are looking strong, as is pricing. I think we are going to have a cracking spring/summer 08," he said.

Pricing architecture at French Connection has beenshifted down over the past season, with recommended retail prices dropping to levels that one franchisee said were "more competitive".

However, an online Drapers poll of individual voters revealed that out of 130 people, just 29 had shopped in French Connection in the past six months.

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