NEXT has increased its full-year profit guidance by £25m after second-quarter full-price sales significantly exceeded expectations.
Full-price sales rose by 9.2 per cent during the 13 weeks to 1 August, compared with the retailer’s forecast of 4 per cent. Sales were £70m ahead of expectations, comprising £19m in the UK and £51m overseas.
International online sales increased by 36.9 per cent, while total UK online sales grew by 5 per cent. UK LABEL sales rose by 13.2 per cent, although sales through NEXT’s own online brand fell by 1.2 per cent.
Retail store sales declined by 0.3 per cent, leaving total UK full-price sales 2.8 per cent ahead of the previous year.
NEXT attributed the performance to warm UK weather, the release of pent-up demand in the Middle East and Northern Europe, and higher-than-anticipated spending on profitable marketing.
First-half full-price sales increased by 7.7 per cent, including growth of 23.9 per cent internationally and 3.6 per cent in the UK.
The retailer now expects to deliver pre-tax profit of £1.243bn for the full year, representing growth of 7.3 per cent. Its previous forecast was £1.218bn.
Full-year full-price sales are expected to reach £6bn, up 6.3 per cent, with total group sales forecast at £7.5bn. NEXT has retained its guidance for full-price sales to grow by 5 per cent during the second half.
The company expects to complete £524m of share buybacks during the year. It has spent £355m so far, leaving £169m available for further shareholder returns.
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