Next raises profit forecast after good Christmas
Full-price sales including interest income rose 5.2% during fourth quarter
Next was the first major UK-listed retailer to provide an update on Christmas sales. Photograph: Dominic Lipinski/PA Wire
Clothing retailer Next edged up its profit forecast for the full 2019-20 year after better-than-expected sales in the Christmas trading period, helped by a much colder November than last year.
Next, the first major UK-listed retailer to update on Christmas sales, said on Friday full-price sales, including interest income, rose 5.2 per cent in the period from October 27th to December 28th, the bulk of its fiscal fourth quarter.
That was 1.1 per cent ahead of Next’s internal forecast and compared to third quarter growth of 2 per cent.
The group, which trades from about 500 stores in the UK and Ireland, about 200 stores in 40 countries overseas and its Directory online and catalogue business, said its sales performance in the period was also assisted by improved stock availability in both its retail stores and online.
As a result Next increased its full-price sales growth guidance for the year by 0.3 percentage points to 3.9 per cent and its profit guidance by £2 million ($2.6 million) to £727 million, an increase of 0.6 per cent on 2018-19.
It also forecast earnings per share (EPS) growth of 5.4 per cent, which partly reflects share buy backs.
Looking further out to the 2020-21 year, Next’s guidance is for full-price sales to increase 3 per cent, profit to grow 1 per cent and EPS to rise 3.4 per cent. Surplus cash generation was forecast at £290 million.
Shares in Next, up 67 per cent over the last year, closed Thursday at 6,954 pence, valuing the business at £9.35 billion. – Reuters