Retailer French Connection Loss Triples on Virus Hit, Shares Slump

A French Connection store in London. (Reuters)
A French Connection store in London. (Reuters)
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Retailer French Connection Loss Triples on Virus Hit, Shares Slump

A French Connection store in London. (Reuters)
A French Connection store in London. (Reuters)

British clothing retailer French Connection Group Plc said on Tuesday sales had halved on the back of the coronavirus crisis in the first half of the year, more than tripling its underlying loss compared to the same period a year earlier.

Shares in the company slumped nearly 16% to 7.55 pence by 0707 GMT, deepening a 76% fall so far this year.

Britain’s retail sector, already struggling with rising costs and stiff online competition, has seen a turbulent year due to the coronavirus crisis, with many companies slashing jobs and permanently closing stores.

“This has undoubtedly been the most difficult trading period that the Group has ever faced,” Chairman and Chief Executive Stephen Marks said in a statement.

French Connection, which has not been profitable in nearly a decade, reported an underlying loss of 12.2 million pounds for the six months ended July 31, compared with a loss of 3.6 million pounds a year earlier.

The company, once known for its provocative FCUK brand of clothing and accessories, said virus restrictions hit revenue by 22.2 million pounds and profit by 9 million pounds during the period.

Just as stores started reopening and restrictions on movements eased, the UK government started tightening curbs again on some areas to stymie an acceleration in infections.

French Connection, which owns brands including Great Plains and YMC, said the recovery in sales since the stores reopened has reversed slightly due to the new restrictions.

The company, which pulled plans to sell itself earlier this year, had warned it could run out of cash earlier this year before securing a 15 million pound funding for two years to cover its cash needs.



Burberry Announces Turnaround Plan as Sales Continue to Slide

FILED - 22 August 2018, England, London: A general view of the Burberry logo displayed on the facade of its store in New Bond Street. Photo: Yui Mok/PA Wire/dpa
FILED - 22 August 2018, England, London: A general view of the Burberry logo displayed on the facade of its store in New Bond Street. Photo: Yui Mok/PA Wire/dpa
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Burberry Announces Turnaround Plan as Sales Continue to Slide

FILED - 22 August 2018, England, London: A general view of the Burberry logo displayed on the facade of its store in New Bond Street. Photo: Yui Mok/PA Wire/dpa
FILED - 22 August 2018, England, London: A general view of the Burberry logo displayed on the facade of its store in New Bond Street. Photo: Yui Mok/PA Wire/dpa

Burberry's new CEO Joshua Schulman announced a turnaround strategy for the struggling British luxury brand on Thursday, as sales continued to slide in its second quarter.
Burberry suspended its dividend for 2025 and announced a 40 million pound ($50.73 million) cost savings program. According to Reuters, Schulman said the brand needed to focus back on outerwear and its core customer.
"Today, we are acting with urgency to course correct, stabilize the business and position Burberry for a return to sustainable, profitable growth," Schulman said in a statement.
Sales in Burberry's second quarter ending Sept. 28 fell at the same pace as the first, with revenue for the first half down 20% in constant currency.