Losses in compressor stages (low pressure and high pressure) and the interconnecting annular duct between the two affect the overall performance of a gas turbine engine significantly. For many space applications, requirement of a light weight and efficient engine inspires the researchers to find an optimum spacing between the blade rows and an optimum length of the duct. The present work focusses on the analysis and performance evaluation of an S-shaped annular duct of a small turbofan engine and possible length reduction methodology. Experiments have been carried out in an annular S-duct with flowrate up to 1.6kg/s and numerical methodology has been validated against experimental data. Total pressure loss coefficient (normalized with inlet quantities) of the baseline geometry (S-duct without strut) is found to be 0.153 as opposed to 0.184 for the duct with struts. Performance has been evaluated by local modification of struts to minimize losses. By numerical simulations the axial spacing between the rotor and tandem stator has been optimized.