Next lifts FY profit guidance despite autumn sales drop
As the UK recorded one of the hottest Septembers on record this year, the result of warmer weather caused sales to be ‘volatile’ at Next during Q3
Next has raised its full-year profit guidance for the fourth time this year, despite weekly sales falling by 7% in September due to the unusually warm weather.
However, the retailer’s recent Q3 results showed that sales bounced back once colder weather came in last month, increasing by 16% and 11% in the first two weeks of October respectively. This has helped sales in Q3 grow by 4%.
According to Next, this was better than its previous guidance for growth of 2% in Q3. the retailer now expects group underlying pre-tax profits to increase by 1.7% over the year to £885m on a sales increase of 3.1%.
As the UK recorded one of the hottest Septembers on record this year, the result of warmer weather caused sales to be “volatile” at Next during Q3.
In addition, the quarter was boosted by a price hike of 7% in H1. However, the group noted that it will slow down the price increases to 2% over the autumn and winter season.
During the quarter, Next acquired Fat Face for £115.2m – the latest in its aggressive acquisitions programme which also snapped up Made.com, Joules and Cath Kidston.
