French Connection’s UK retail business showed an improvement in the third quarter as like-for-like sales were stable compared to last year.
An update for the 16 weeks to November 20 showed a marked improvement on the first half of the year in which the high street retailer reported a 9.5% decline.
UK and European retail sales were helped by the more auutmnal weather in comparison to last year, with sales of outerwear and knitwear much improved.
However wholesale revenues continued to be below last year as a result of lower forward orders and reduced in season business.
In the statement French Connection said: “Group profit before tax for the third quarter was broadly in-line with our internal expectations but as ever the overall outcome for the year is dependent on the retail selling season over Christmas and New Year.”
The retailer said the implementation of initiatives from its review of its retail arm was “progressing well”. Operational changes in trial stores have boosted sales so far, and are now being implemented across the full portfolio targeting key stores first.
French Connection also managed to achieve a £5m year-on-year reduction in stock by the end of October.
However, it admitted that progress on shedding its under-performing stores has been slow as demand for retail space remains weak.
“We remain confident that the initiatives being implemented and tight cost management will result in a steady and significant improvement in the revenue and gross margins in the business and will therefore have a positive impact on group profitability across the next two financial years,” the company said in a statement.