Next full year profit better than expected
Next has posted better than expected full year profit as it said it expects to raise prices more slowly in the year ahead.
In the 12 months to January 2023, the fashion and homeware retailer’s pre-tax profit increased by 5.7% to £870 million, which was £10 million higher than its previous guidance of £860 million.
Meanwhile full price sales rose by 6.9% year-on-year and total trading sales, including markdown, were up 8.4% in the period.
Next said it will be focusing on improving product ranges and online service levels in the year ahead while laying the foundations for future growth.
The company said price inflation is set to be “more benign” than previously thought this year and that like-for-like price inflation for its collections is expected to be 7% for the spring/summer and 3% for autumn/winter.
While full price sales in January were flat and in line with guidance, the participation of higher margin retail sales was greater than expected, which added £5 million to profit.
Although the company has warned that the current year is set to be “challenging”, it has reiterated its guidance for sales and profit with full price sales expected to be down 1.5% year-on-year and pre-tax coming in at £795 million.
Next chairman Michael Roney said: “It has been a good year for Next. We have embraced the various challenges and seized the opportunities that have arisen. If we continue to improve our product ranges, relentlessly manage our costs and upgrade our customer service, whilst also developing new business opportunities; we can lay the foundations for an exceptionally strong business and still deliver healthy profits, cash flow and dividends.”
