The results were not a surprise to the City, which had been braced for bad news since a profits warning in November.
The figures suggested shoppers are tired of the once iconic FCUK brand.
Profit in the 12 months to January fell 53 per cent to £15.7m on turnover that dipped slightly to £246m.
Stephen Marks, the chairman, said: "The last year has proved to be the most difficult we have experienced for a considerable period of time. These results are a major disappointment to the board and we are doing all that we can to reverse the decline."
He said sales since the turn of the year have been strong, insisting"analysts seem supportive" of the company's new approach.
To try to retain its edgy image, French Connection launched an advertising campaign last month that features women kung fu fighting and then kissing each other. The Advertising Standards Authority has been inundated with complaints. The shares, once above 490p, fell 3p to 249.75p yesterday.
Sanjay Vidyarthi, at Teather & Greenwood, said of the planned turnaround: "It was always going to take time for retailers to regain confidence in French Connection and reallocate them space. It will take at least a year, if not longer."
French Connection said summer orders for its European wholesale business, the arm that generates nearly a third of the group's sales, were down 25 per cent on a year ago. Some analysts saw this as a worrying decline.
While FCUK remains the core brand, the plan is to use it more subtly, playing on customer loyalty.
French Connection has been in trouble before. The company made a £5m loss in 1992, but recovered to make £39m in 2003.
Mr Marks, who bankrolled the Guy Ritchie film Lock, Stock and Two Smoking Barrels, still owns 42 per cent of the business he founded with Nicole Farhi.
The retail entrepreneur thinks customers, typically aged 16 to 25, like the company's new clothes line and that wholesale customers such as House of Fraser and John Lewis are giving them good space in stores.
Although much of the UK high street seems vulnerable to bids from private-equity groups, Mr Marks said he has not had any approaches.
Baugur, the Icelandic group with a reputation as a corporate raider, has increased its stake in French Connection to almost 14 per cent. But a mooted takeover bid has not arrived. Baugur has since indicated it intends to hold the stake for the long term.Reuse content