Next warns of toughest year since 2008
Clothing retailer Next met its latest guidance with a 5pc rise in annual profit but cautioned 2016 could be the toughest it has faced since 2008 as it anticipates a more difficult economic environment.
Next, which trades from more than 500 shops in Britain and Ireland, about 200 mainly franchised stores overseas and its Directory catalogue and Internet business, downgraded its sales forecast for the 2016-17 year to a range of down 1pc to up 4pc from previous guidance of growth of 1pc to 6pc.
"The year ahead may well be the toughest we have faced since 2008," it said on Thursday, noting the outlook for UK consumer spending does not look as benign as it was at this time last year.
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Next made a profit before tax of £821.3m ($1.2 billion) in the year to end-January 2016. That compared to company guidance of about £817m (800-834 million pounds) and £782m made in the 2014-15 year. Sales rose 3pc to £4.15bn and the dividend was raised 5.3pc to 158p.
Next has been the strongest player in Britain's clothing sector for a decade. However, its January update disappointed as the firm missed forecasts for Christmas trading, blaming unhelpfully warm weather, poor stock availability and increased online competition, sending its shares lower.
The stock, which has fallen 10pc over the last six months, closed Wednesday at 6,660p, valuing the business at £10.1bn.