French Connection hails ‘encouraging’ post-lockdown sales
French Connection has been boosted by “encouraging” trading since stores in England and Wales reopened following the latest lockdown, as it secured more funding for its US arm.
The fashion retailer saw shares jump after it told investors that forward orders for spring 2021 are currently ahead of expectations.
French Connection reported that trading was in line with company forecasts over the start of the second half of 2020.
However, it said the tightening of pandemic restrictions and guidance from September drove a slump in footfall as conditions “became slightly more difficult across the retail channels”.
This was compounded further by the second national lockdown in England last month, but the company had been boosted by positive pre-Christmas sales since reopening stores.
The group added that online sales have continued to “trade positively” despite a decrease in promotional activity compared with the same period last year.
It comes after a raft of major retail failures in recent weeks, with Topman-owner Arcadia hiring administrators while Debenhams launched a liquidation process.
French Connection said it has now also secured 6.5 million dollars (£4.9 million) of funding to support its US operations and employees.
It said it has received the money as a loan from Flushing Bank, New York, for a period of five years with repayments commencing from the end of the third year.
The US arm is predominantly wholesale therefore requires a significant amount of working capital at certain times of the year to operate, it said.
In a statement, the company said: “Looking forward there will continue to be considerable challenges, with both the ongoing impact of Covid-19 and the uncertainty relating to Brexit but we feel we are well positioned to capitalise on any opportunities that arise.”