Sales in US lift French Connection

A STRONG recovery in US sales helped French Connection, the fashion wholesaler and retailer, to return to the black in the half-year to 31 July, writes Neil Thapar.

The company turned around a pounds 768,000 loss into a pounds 2m taxable profit, on sales up a third to almost pounds 31m. Earnings per share amounted to 4.4p against a loss of 6.3p. But there is no dividend and the company said it will not be paying a final either.

The results reflect a strong advance in the US, where sales more than doubled to pounds 10.8m. George Wardale, the chairman, said the growth stemmed from better designs and improved performance by its eight retail stores there.

A similar performance by the group's 27 shops in Britain also helped to boost profits at home, but difficult trading conditions led to a fall in wholesaling sales from pounds 5.3m to pounds 5.1m.

Nicole Farhi, the upmarket label, maintained its profit margins with sales up from pounds 3.1m to pounds 3.7m.

Interest costs more than halved to pounds 307,000 thanks to a sharp reduction in net borrowings from pounds 7.8m at the end of last year to pounds 5.3m at the interim stage - equivalent to 88 per cent of net assets. Mr Wardale said: 'Trading conditions continue to be very competitive; however, demand for the group's products under both the French Connection and Nicole Farhi labels is strong for both winter 1993 and summer 1994.'