Next cheered the City today with a 2.9 per cent rise in full-price sales in the run-up to Christmas, though it warned it was “very cautious” about the year ahead.
The figure for trading from October 28 to December 24 means the chain, which has two stores in Preston and one in Walton-le-Dale, is on track to outperform its forecast of one per cent growth for the quarter to January.
With Next also announcing a 50p special dividend for shareholders, the update – the first significant retail figures since Christmas – boosted its shares by as much as four per cent and gave a lift to rival Marks & Spencer too.
Next’s announcement revealed that while sales from its stores were ahead by only 0.5 per cent, overall trading was lifted by its Next Directory online and catalogue arm, up seven per cent.
The group said it had gone into its end-of-season sale with “significantly more stock than last year”. It warned in October that it had been hit by the mild autumn weather, which resulted in it lowering profit expectations as it needed to offload goods at a discount.
Following today’s trading update, it said full-year profits should be £775m – £5m higher than at the time of the warning. Week-by-week figures showed full-price sales struggled in November but picked up in the run-up to Christmas and were ahead by £20m in the final week, though the figure was flattered by the retailer having an extra day’s trading compared to 2013.