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20 Sep 2018 | 08:07

French Connection sales sink as gloomy UK high street, store closures weigh

French Connection reported Thursday a decline in first-half sales as growth in wholesale performance was offset by a reduced store portfolio and a 'tough' retail backdrop in the UK.

For the six months ended 31 July, group revenues fell 2.4% to £58.1m as 6.2% jump in wholesale revenues was offset by a 7.0% decline in like-for-like sales in UK and Europe.

Overall retail revenue decreased by 10.5% to £27.3m.

Composite gross margin fell to 41.5% for the half year, from 42.9% as the company sold a higher proportion of wholesale items.

The company said it had closed a further two non-contributing stores closed during the last six months, while one new concession was opened.

The group remained on track to return to profitability at the year. 'I am pleased that the changes we have made around the business over the last couple of years continue to move us forward,' said Stephen Marks, Chairman and Chief Executive. 'There is no doubt that progress has not been helped by the trading conditions in which we operate in the UK, although we can take great confidence from the performance of the wholesale business and the stability of the licence income.' 'The order books we have provide a clear outlook for the second half of the year in wholesale although retail continues to be challenging. We remain on target to return the business to profitability this year and we will be doing everything we can to ensure that happens.' At 8:07am: (LON:FCCN) French Connection Group PLC share price was 0p at 50.1p

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