Latest Financial Results

Presentation for the 12 months to 31 January 2017 (pdf)

Preliminary results for the year ended 31 January 2017 (pdf)

French Connection Group PLC

Full Year results for the year ending 31st January 2017

French Connection Group PLC ("French Connection" or "the Group") today announces results for its financial year ended 31 January 2017.

Highlights:

  • Improved trading performance despite Group Revenues down 6.7% to £153.2m (2016: £164.2m)
  • UK/Europe Retail Like-for-Like¹ sales up 4.4%, despite a challenging trading environment in H2
  • Overall retail revenue down 4.9% to £87.9m (2016: £92.4m) on an average space reduction of 11.7%
  • Ecommerce sales grew by 12.7% and now represent 27.3% (2016: 23.0%) of retail revenue
  • Continued portfolio management with nine non-contributing stores closed in the period
  • Wholesale revenue down 9.1% (2016: down 4.5%) but improvements in H2
  • Underlying² operating loss reduced to £(3.7)m (2016 £(4.7)m). Results largely driven
  • by the improved trading performance
  • Working capital tightly managed with inventory reduction of 12.4% to £31.7m (2016: £36.2m)
  • Closing cash position of £13.5m (2016: £14.0m)
  • Two stores have already closed after year end and an additional six stores are earmarked for closure this year to bring the Group closer to the target of 30 full price French Connection stores by January 2019
  • Strong performance in the first 6 weeks of the new financial year for the Spring 17 range

Commenting on the results, Stephen Marks, Chairman and Chief Executive said:

We have seen an improvement in performance over the financial year with continued good progress in the UK/Europe retail business, but as previously reported, this has been partly held back by the wholesale and licensing divisions, particularly in the first half of the year.

The noticeable improvement we have seen during the second half and into the new financial year leads me to believe that we are moving in the right direction. The reaction to this year’s collections has been very strong so far with sales both in our stores and wholesale customers up on last year. It is early in the year and we have a considerable amount of work to do to take the Group back to profitability although I believe that the actions we have taken and continue to take, will go a long way to achieving that goal this year.


Notes:
1. Key performance indicators for the 52 week trading period are outlined below:

FY17 FY16 Var %
Total Group revenue (£m) 153.2 164.2 (6.7%)
Total Retail revenue (£m) 87.9 92.4 (4.9%)
Total Wholesale revenue (£m) 65.3 71.8 (9.1%)
Ecommerce revenue (£m) 24.0 21.3 12.7%
Ecommerce participation (%) (as % of total revenue) 27.3 23.0
Retail LFL¹ (%) +4.4 -6.4
Stock (£m) 31.7 36.2 (12.4%)
Net Retail Space reduced UK/Europe (sq.ft. ‘000s) 21.2 14.2 49.3%
Net Retail Space reduced Group (sq.ft. ‘000s) 26.1 33.4 (21.9%)
Average UK/Europe Retail Space (sq.ft. ‘000s) 208.7 226.4 (7.8%)
Average Group Retail Space (sq.ft. ‘000s) 224.9 254.7 (11.7%)
Number of stores/concessions:
- Operated 124 133 (6.8%)
- Franchised, Licensed & JV 285 288 (1.0%)
Underlying gross margin (%) 45.8 46.3 -50bps
Net cash position (£m) 13.5 14.0 (3.6%)

Notes:
2. The trading comparatives for each half of FY17 are detailed below (unaudited):

FY17 H1 17 H1 16 YoY% H2 17 H2 16 YoY% 2017 2016 YoY%
Total Retail sales (£m) 41.6 42.6 (2.3) 46.3 49.8 (7.0) 87.9 92.4 (4.9)
UK/Europe LFL sales (%) +6.5% -10.7% +2.6% -2.4% +4.4% -6.4%
Average Group Retail Space (sq.ft. ‘000s) 228.7 266.0 (14.0) 215.7 249.3 (13.5) 224.9 254.7 (11.7)

Notes:
1. LFL or “Like-for-Like” sales growth is defined as the year-on-year sales growth for owned stores and concessions open more than one year, including ecommerce revenues, removing the impact of closed stores and reported in constant currency.
2. Underlying Operating Loss excludes profit/loss on store disposals and closures.

The Directors believe these measures are best reflective of how the business is managed and are informative to shareholders in understanding the performance of the business.

Enquiries: Neil Williams
Lee Williams
French Connection +44(0)20 7036 7063
Tom Buchanan
Katherine Fennell
CNC-Communications +44(0)7974 982366
+44(0)7971 828445