French Connection spreads gloom

SHARES in French Connection dropped today after the company said attempts to revitalise its ranges after dire autumn and winter seasons had been only partially successful.

The company, famous for its Fcuk brand, said consumers remained cagey about spending and High Street conditions were still 'difficult'. French Connection shares dipped 6p to 242p in early trading after a trading update, issued ahead of today's annual meeting.

Finance director Roy Naismith told This is Money that the company was looking beyond tomorrow's General Election for more certainty. He said: 'It will be a watershed. I don't think it helps to have three leading politicians on television every night telling people that the others will all put up taxes if they get into power. I think the election will clear the air in the consumer's minds. It's a confidence thing and I believe that lack of certainty about the economy, and who's going to be in charge of it, drives that.'

Naismith insisted that efforts to improve French Connection's fashion offering had had some impact. But, he added, consumers still aren't shopping in a major way and repeat orders from wholesale customers have been slower than normal.

'The improvements we have made to our ranges have been well received and are having a positive impact on our sales. We have seen particular improvements in ladieswear. But although this work has achieved a good impact, it's not as much as we'd been hoping for. The broader retail environment is worse than we expected.'

Naismith rejected suggestions that chairman and chief executive Stephen Marks was considering any bid to take the group private. French Connection shares are currently worth less than their near 500p peak last summer. Marks lost control of the company he founded 33 years ago when he was forced to sell £40m of shares last June to help finance his divorce. He currently holds 42% of the shares, compared with 51% a year ago. But Naismith said he was not planning any bid to take the group off the market.

'Stephen is very much focused on keeping the business on track, ensuring the garments in our stores are what customers want and driving the business back to where we have had it. He is not messing around with taking the company private,' Naismith declared.