French Connection Share Discussion Threads

[tmfmayn] 31/7/2015 11:32

Hi thorne1,

Yes, FCCN has said its unprofitable stores have on average 4 years left on their leases to run. So that really is the timescale I think investors should be looking at for some sort of permanent move to profitability. My gut feel tells me the next set of (interim) results will be poor, but could include news of a further restructure and you never know, a well-defined medium-term strategy! Either way, I really do think a fresh exec is needed here to revitalise the boardroom. I have certainly never been impressed by the Ops Director in person.

True, there may have been solid buying from the mid-50s down, but there has been solid selling as well. I just hope the sellers don't know what has been going on!

Mayn

[she-ra] 31/7/2015 11:27

TMFMayn - You need bricks.I think your idea for a turnaround is amateur.

[thorne1] 31/7/2015 11:01

Mayn-Many thanks for your very valid comments.-In my opinion the critical areas of restructuring are well under way as I've indicated above, however this exercise could take a couple of years to complete.By then the company will be profitable and Marks will be over 70 providing an opportunity for all sorts of buyers not least in the private equity sector.The international licensing operation is clearly where the value lies.Roland Castleton the FD who is just about to depart did not in my view see himself as a permanent "fire fighter" and his action in leaving clearly indicates the way things are developing.There is solid buying of any shares that become available and this has been the case from the mid 50's down to the present level.These buyers clearly know what's going on;more's the pity that the shareholders at large have not been informed about what is probably a pretty well defined medium term strategy.

[puzzler2] 30/7/2015 13:49

That's a hell of a lot to get done thorne. Whilst this has been on my watch list for a long time now, Marks has to be replaced by a young-entrepreneurial type before this company is investable imo. For now, the chart says it all. Good luck if you're a holder - I suspect if, as you suggest, you're patient enough, this may come good - eventually!

[thorne1] 30/7/2015 13:20

There is certainly value in these shares and only patient shareholders will benefit.Before that happens a few significant problems have to be sorted out:a) the relocation of the head office into smaller premises;b) the closure of more uneconomic stores in the UK and possibly in the USA and c) the further refinement of the product range.The realisation by Marks that he is well "passed it" would also help.He is however no fool.

[she-ra] 30/7/2015 12:54

Probably not.

[hutch_pod] 29/7/2015 23:27

Is he that conniving?

[she-ra] 28/7/2015 16:43

Ted Baker now has a market capitalisation that is 37.5 times bigger than that of French Connection's. If Ted Baker had revenues 37.5 times more than French Connection it would be £6.58 billion. But its revenues are actually £387.6 million.

Anyone ever seen the movie 'The Hudsucker Proxy'?

I'm thinking of selling this idea I have of a square to Stephen Marks.

[she-ra] 23/7/2015 13:31

Ben Sherman has just been bought by Marquee Brands for £40 million. Ben Sherman has revenues of £49 million and made £6.5 million in losses.

Marquee Brands are buying up underperforming clothing and footwear brands with the aim of turning around their fortunes and exploiting fully their licensing potential.

[amchugh] 13/5/2015 15:03

www.thetrendspotter.net/2015/05/french-connection-x-thetrendspotter.html

[dlku] 13/5/2015 14:39

oh yeah. forgot

[zoolook] 12/5/2015 14:25

they don't make a profit

[dlku] 12/5/2015 10:57

profit warning here?

[mesquida] 01/5/2015 19:17

No, certainly not.

[she-ra] 01/5/2015 18:11

mesquida - You related to Chris Oil?

[mesquida] 01/5/2015 17:04

Ever since the day of the share price collapse a large buyer has been looking for 1 million shares, but has not been able to complete the order. Perhaps now he is beginning to bid up in the hope of encouraging more stock to come out. Question is, who is this buyer ? If he is the same buyer that has been operating for several months now then surely it is about time that we saw a holdings rns. And is he a straightforward investment buyer or is something corporate finally afoot ? This clearly is not the time for the rest of us to be bailing out !

[ali47fish] 01/5/2015 13:27

why the rise today anyone?

[thorne1] 30/4/2015 11:54

I raised this issue with Castleton(FD) recently and his response was that the company would"absorb" any rent increase.He did not say how much this might be or indeed how much of the total space in the building French Connection actually occupy.In my opinion a fairly substantial increase must be expected unless the company relocates elsewhere which is unlikely bearing in mind all the attendant costs."Corporate activity" could however precipitate a move to avoid any extra costs.

[thorne1] 30/4/2015 11:54

I raised this issue with Castleton(FD) recently and his response was that the company would"absorb" any rent increase.He did not say how much this might be or indeed how much of the total space in the building French Connection actually occupy.In my opinion a fairly substantial increase must be expected unless the company relocates elsewhere which is unlikely bearing in mind all the attendant costs."Corporate activity" could however precipitate a move to avoid any extra costs.

[cockerhoop] 30/4/2015 10:08

Very interesting Maynard,

I suppose the crux is the scope of the review in Q4, it appears that later tenants e.g. Hugo Boss (from 2006) already pay a bit more than FCCN (from 2000). I'm not sufficiently versed in standard review terms (market rate?, inflation plus?) to gauge whether they'll be liable for a substantial increase in costs in 2015.

As an aside if I owned the building and was looking to get out, surely it'd be in my interest to secure the rent reviews first to maximize the sale price.

[tmfmayn] 30/4/2015 08:58

Me again.

I am sure this has been mentioned in passing before (by thorne1?), but I found this recently:

hxxp://www.michaelelliott.co.uk/uploads/201501301042202104607Centro%201and2,%20Camden,%20London%20NW1%20-%202015.pdf

Seems as if FCCN has been paying a cheap HQ rent and the agent now reckons the property could command higher payments from tenants.

There's a table towards the end listing all the tenant payments and it looks as if FCCN’s HQ rent could rise by £1m :-(

[tmfmayn] 29/4/2015 11:13

Hi thorne1

"Some fairly tough action is now required from the Board to sort this mess out.Confidence levels must be low and approaches from interested corporates must now be more acceptable and therefore likely to succeed. I should imagine that lines of communication have been buzzing all weekend.Let's hope that SM's obstinacy does not cause him to hang on for too long."

I bet the lines of communication were buzzing more from upset shareholders than potential suitors :-( More I think about it, more I think Marks has to step back into a non-exec and appoint a separate chief exec to axe the Retail estate and focus on the profitable Wholesale and Licensing divisions.

Marks is up for re-election at the forthcoming AGM and there is the chance for unhappy shareholders to vote against him. Doubt he'll ever be voted off but a few NO votes might send him a message.