French Connection to focus on turnaround plans as no buyer is found

French Connection shares slumped this morning after the chain revealed that after a lengthy process it had not found a buyer for the business and would be continuing with its turnaround plans.

Shares dropped 32.5% to 22.6p on early trading as it revealed in trading update that its strategic review had been concluded and the formal sale process closed.

"The Company has concluded that it will now focus on completing its turnaround and build on the progress made in recent years," is said in the statement.

It added that it would be focusing on: right-sizing its store portfolio; close collaboration with wholesale customers; increased investment in online; development of licenses in further product categories; and cost reductions.

French Connection confirmed it was considering a sale of the business back in October 2018. It then extended the sale process in June of last year and said discussions were ongoing with a number of interested parties.

Chairman and CEO Stephen Marks holds a 42% stoke in the business, while Mike Ashley's Frasers Group (formerly Sports Direct International) holds a near 30% stake.

The company will announce its year-end figures on 10 March. In the year to 31 January 2019, after years of losses, it made an underlying operating profit of £0.1m. However that figure excluded profit/loss on store disposals and closures, provisions for bad debts and onerous leases and other professional fees; when these were taken into account, the business reported an operating loss of £9.3m. Total group revenue edged up 0.2% to £135.3m.