Next says 2016 clothing sales could fall by 2.5 percent
Next, one of Britain's biggest clothing retailers, on Wednesday said that 2016 sales could fall by 2.5pc, an improvement on a previous forecast, warning that it expected a longer term trend of weaker clothing demand to persist.
Next said that full-price sales would this year be in the range of 2.5pc lower to 2.5pc higher, narrowing a previous range of anything from 3.5pc lower to 3.5pc higher.
The company said that it was too early to tell what the impact of Britain's vote to leave the European Union in June was having on consumer demand in the country, and blamed what it called extremely volatile trading on an underlying weakness in demand for clothing which dates back to last October.
"Our wider than normal range reflects the continued uncertainty and volatility of consumer demand," Next said in a statement.
Next warned that the devaluation of the pound since the vote would mean that input costs would rise by about 5pc on like-for-like products from 2017/18.
Next said its currency exposure was fully hedged up until January 2017.
For the second quarter period, Next reported a 0.3pc rise in full-price sales, but warned that the current quarter would be worse given a tougher comparison.
Next said that it expected annual group pretax profit to be in the range of 775 million pounds to 845 million pounds, narrowing a previous forecast for it to come in between 748 million pounds and 852 million pounds.