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Tough economic conditions will hurt recovery at fashion retailer French Connection, the company's chairman said.

London-based French Connection reported a decline in profit before tax to £3.1 million for the year to January 31st 2008, from £4 million last year.

Turnover dipped to £236.1 million from £241.3 million for 2007.

French Connection chairman and chief executive Stephen Marks said the results are "clearly not good enough", blaming a weak trading environment in the crucial run-up to Christmas and lower wholesale orders.

Mr Marks added: "The more difficult economic environment widely predicted for the new year is likely to have an impact on the rate of improvement in our retail business, but we will continue to strive for growth based on our constantly evolving fashion-forward products."

Despite sales improvements throughout the year a worsening retail market in the final quarter, both in the US and the UK, drove the decline in profits.

Menswear was also a problem over the year, the retailer added. While womenswear achieved a like-for-like increase of two per cent over the year, menswear showed an 11 per cent decline.

Looking forward, French Connection said wholesale orders for Spring/Summer collections are ahead five per cent, while initial orders for Autumn/Winter are also showing growth.

The retailer was cautiously optimistic about the figures, adding much will still depend on the retail environment over the year.

The board has proposed holding the total dividend at 5p.