High-street retailer French Connection (LON:FCCN) reported their ninth year of losses on Tuesday, as the company continues to struggle.
Sales dropped 6.7 percent to £153 million, with pre-tax losses rising 51 percent to £5.3 million for the year ending January 31. The fashion brand has not turned a profit since 2012, with the retailer continuing to lose popularity and its stake on the high-street.
Founder and Majority share holder Stephen Marks, who currently owns 42 percent of shares commented:
“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,” he added.
The company has been under increased pressure from investors to update its corporate structure. One investor, Gatemore Capital Management, has been openly critical of French Connection’s governance. Liad Mediar, Chief investment officer at Gatemore, said of the results:
“We are disappointed, but unfortunately not surprised, that French Connection have failed to improve on last year’s dismal results. The board is a mockery of modern corporate governance. With the resignation of Christos Angelides, there are no independent directors in place and the Chairman/CEO, Stephen Marks, is refusing to split his role and is running the business with no regard for shareholders.”
Sports Direct’s (LON:SPD) Mike Ashley last month was able to buy an 11 percent share of the company after investors continued to express their unease. Sports Direct has also been the subject of controversy in recent months, after workhouse conditions at its workhouses were criticised for displaying “victorian workhouse” conditions.
Shares in French Connection are currently up 3.94 percent as of 08.53AM (GMT).