Next has announced an unexpected increase in profit guidance for the fiscal year. The company attributes this to robust full-price sales, exceeding prior estimates.
- In the 13 weeks up to 27 July, Next witnessed a 3.2% rise in full-price sales, surpassing their predictions by £42m.
- UK online and retail operations saw a modest increase in sales by 0.4% during the second quarter, while overseas online sales surged by 21.9%.
- The first half of the year saw total full-price sales grow by 4.4%, significantly surpassing the anticipated 2.5% increase.
- Acquisitions, specifically of FatFace and further shares in Reiss, contributed to an 8% growth in group sales during the first half.
In a surprising turn, Next has raised its profit outlook for the year by £20m to £980m, marking a 6.7% increase compared to the previous year. This adjustment comes after the company reported a 3.2% increase in full-price sales over 13 weeks, outperforming expectations by £42m. Despite earlier forecasts anticipating a 0.3% decline due to an exceptionally strong summer last year, sales metrics have conveyed a more optimistic scenario.
Both UK online and in-store sales showed a slight 0.4% increase in the second quarter. Meanwhile, overseas online sales demonstrated considerable vitality, soaring by 21.9%. The overall growth in full-price sales during the first half of the year was 4.4%, which outstripped the original projection of a 2.5% rise. The firm has maintained its prediction of a 2.5% sales increase in the second half as well.
Additional growth was supported by strategic acquisitions made in the previous year, particularly the acquisition of FatFace and an increased equity stake in Reiss. These moves contributed to an 8% increase in group sales during the first half. Consequently, Next revised its annual profit estimation upwards by £20m, fueled by £11m in new sales and £9m in logistics cost savings.
Next’s enhanced financial outlook underscores the company’s successful sales strategies and effective acquisitions, fostering growth and stability.
