After strong Q2, Next raises sales and profit outlook

Full price sales in the second quarter at Next Plc increased 4 percent on last year, while the company said, was 4.5 percent better than the guidance of negative 0.5 percent expectation given in its May trading statement. Following the better than anticipated sales performance in the second quarter, Next is increasing its full price sales guidance for the second half from 1.7 percent to 3. percent, in line with its full price sales growth in May and June.

The company added that increase in full price sales guidance is 70 million pounds and, after accounting for associated costs, is expected to add 20 million pounds to profit. Lower clearance rates to date, along with anticipated lower clearance rates in the second half, are forecast to cost an additional 10 million pounds and as a result, Next is increasing guidance for full year group profit by 10 million pounds to 725 million pounds, marginally up on last year and expects earnings per share to grow by 5.2 percent.

Next further said that the second quarter’s performance by month shows that full price sales during May and June combined were up 3 percent; July saw strong growth of 6.8 percent on last year. However, the company added that some of July’s over-performance in full price sales came as a result of lower markdown sales in the end-of-season sale.

Full price sales in the first half were up 4.3 percent on last year and total sales, including markdown sales, were up 3.8 percent.

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