French Connection likely to miss target

London: Fashion group French Connection Group said 2012 profit would likely miss current market expectations, issuing the latest in a series of such warnings as challenging conditions in its core British market continue.

French Connection, whose eponymous high street clothing chain accounts for over 90 per cent of its sales, said revenue dropped 9.5 per cent in first three months of its financial year, and it did not expect an improvement in the second half of 2012.

French Connection's woes reflect tough conditions on the British high street, where retailers are struggling as consumers grapple with inflation, muted wage growth, government austerity measures and worries about job security.

The company, which has a market capitalisation of just over £30 million said it was continuing with a review of its British and European business, having flagged that its smaller US operations were in better health after posting an 11 per cent rise in sales in the period.

The review would help French Connection quickly identify steps it could take to improve the performance of the British and European business, it said.