French Connection Group PLC closed its fiscal year on January 31 and announced the results. The UK-based company reached a profit before tax of £5 million compared to £7.3 million last year. The UK/Europe wholesale channel achieved a 17% increase in revenue and an operating profit of £3.3 million in North America. The brand licensing income grew strongly, increasing by 47% to £8.5 million from £5.8 million last year.

Stephen Marks, CEO and chairman, commented: “During the past year our wholesale, international and licensing businesses have performed well, however, in the most difficult winter season I have seen in all the years I have been in business, our UK retail division has been very disappointing and this has had a significant effect on our results for the year. In the light of the poor performance of the UK retail division we are reviewing our retail operations in order to improve sales and margin in this core business. We are very aware that there will be no quick solutions and that changes we make will take time to have an impact. We are working very hard on improving the performance of the retail stores, although clearly the state of the UK economy is not helping the position… We have demonstrated our ability to produce fashionable, wearable products over the last 40 years and will continue to do so. With the help of the review of operations, a strong balance sheet and our global brand, we will return the business to the level of profitability we feel the group deserves. We will, however, continue to work hard to improve our financial performance. We have added a new premium range in our stores and will be adding a range of home wares to our larger stores and on-line in April. We expect to see further growth in our wholesale channels, in international and additional store openings in China, Hong Kong and India.”