Next raises profit forecast after strong quarter
Next, Britain's second biggest clothing retailer, raised its guidance for annual sales and profit for the second time in three months after a strong second quarter performance, helped by favourable weather and new store openings.
The group, which trades from over 500 stores in Britain and Ireland, about 200 stores overseas, and through its Directory internet and catalogue business, said it now expected a 2014-15 pretax profit of £775-815m.
That compares to previous guidance of £750-790m, and would represent growth of 11-17pc on the £695m made in 2013-14.
Next said on Tuesday its total sales rose 10.7pc in the 26 weeks to July 26, having been up 10.8pc in the first quarter. Store sales rose 7.5pc, while Next Directory sales were up 16.2pc.
Next raised its full year sales guidance to 7-10pc from 5.5-9.5pc previously.
Shares in Next, which have risen 38pc over the last year, closed Monday at 6.520p, valuing the business at £10bn.
Next has generally been able to defy a tough macro economic background helped by its strong online offer, new store openings and diversification into new product areas, such as homewares, as well as new overseas markets.
"It might appear overly cautious to forecast a full-year sales range which is below our current rate of growth," said the firm.
"However, last year's first two quarters were hampered by a particularly cold Spring and Easter which presented a soft comparison for this year."
It said second-half comparative numbers are tougher, particularly in the fourth quarter. It forecast second-half sales growth in the wide range of 4-10pc.
The group forecast full year growth in earnings per share of 12-18pc, up from 8-14pc previously.