London - British fashion retailer French Connection Group reported a loss for the fifth straight year, prompting calls from activist investor Gatemore Capital Management to split up the company.The company’s stock rose 3.9 percent to 36.25 pence (R5.80) on the London Stock Exchange (LSE).
French Connection has closed stores and hired new management and design teams as it struggles to compete with fast-fashion rivals such as ASOS, Forever 21 and Inditex’s Zara.
French Connection’s current position is a far cry from its heady days in 2004, when the huge success of its FCUK logo boosted the company’s shares to more than 500 pence (R8).
However, chief executive Stephen Marks reiterated on Tuesday that his commitment to turn the group profitable and said reaction to 2017 collections had been very strong.
Brokerage Numis Securities said it expected the company to return to profit in the year ending January 2019.
The company has been under pressure from Gatemore, which owns an 8 percent stake, to improve shareholder value.
Gatemore estimates French Connection to be worth £80 million to £100 million.