French Connection has sold its stake in Toast in a bid to free up resources to aid its ongoing turnaround efforts.
The struggling retailer, which owns 75% of Toast, and minority owners and founders Jamie and Jessica Seaton, who own 25%, sold the brand to Danish fashion house Bestseller for £23.3m. French Connection will gain £13.9m cash from the sale.
Founder and executive chairman Stephen Marks, who has previously faced calls from investors to resign some of his responsibilities, said: “French Connection will use the transaction proceeds to underpin its core business, allowing us to focus on our priority of returning to sustainable profitability and growth.”
The retailer posted a loss for the sixth consecutive year last month, although it did manage to narrow losses from £5.3m to £2.3m.
Retail like-for-likes in the UK and Europe were up 0.8% year-on-year, a drop on the 4.4% gain recorded last year. Total retail revenues dropped 5.5% to £83.1m. The business attributed the fall to the closure of 11 “non-performing” locations.