For more than a decade, French Connection had the high street sewn up. It was the destination du choix for quality, if pricey, fashions.
Stephen Marks, the chairman, lapped up the critical acclaim for its once- edgy 'FCUK' ad campaign, while the group's soaring profits helped his personal fortune match the Queen's.
But in the past 12 months the company founded by Mr Marks in 1969 has unravelled at the seams. Sales have slumped as shoppers shunned slogans branded 'tacky' by one of the group's wholesale customers.
Yesterday FCUK (the company uses its initials as its internal nickname), which has issued two profit warnings in the past year, held out little hope that its fortunes were on the mend, reporting further falls in sales and a 70 per cent slide in interim profits.
Most alarmingly, the company said its wholesale customers " its main source of profits " had ordered 15 per cent less winter 2005 and spring 2006 stock than this time last year. It admitted full- year pre-tax profits would be towards the bottom of the pounds 20m to pounds 25m range it gave with its July profits warning. Analysts slashed their numbers again, with some predicting profits for the year to January 2006 would be as low as pounds 17m. And this for a company that made nearly pounds 40m just two years ago.
The demise of French Connection has caught the City's imagination like no other because Mr Marks managed to offload pounds 36.5m worth of his stock close to the peak of the company's valuation last summer " just before sales started to dive. The timing, he said, was nothing but an unfortunate coincidence: he needed the cash to fund his divorce, one of the costliest in the UK. For the first time since he started the company, he no longer has a controlling stake.
Retail experts pin the blame for French Connection's fall from grace firmly on its stubborn refusal to ditch the 'FCUK' moniker, which in its time has urged wearers to 'FCUK for England', 'FCUK like a bunny', or simply, 'FCUK forever'. The slogan, critics argued, dragged a once premium brand into the gutter. Meanwhile, fashion upstarts, from Tesco's Florence and Fred label to Inditex's Zara have moved in and lured customers away from its shops.
Although Mr Marks has fought tooth-and-nail to defend the moniker in the past, yesterday he said the group had toned down its use of its infamous logo. 'Fashion has changed and we've moved on,' he said. Indeed, it proved hard to unearth a single garment brandishing the slogan during a trip to its Canary Wharf outlet. A solitary brown T-shirt was left to say 'Sweet FCUK' quietly in swirly, Woodstock-esque writing.
After a grim summer " the group had to extend its sale by an extra three weeks to shift unsold stock " which saw underlying sales in its UK retail business dive 9 per cent, Mr Marks admitted the group had 'missed opportunities'. Namely it was 'overcautious' on key fashions such as embroidered skirts, so when they sold out, it was left peddling its usual basics. …