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Next is upgrading its full price sales guidance for the full year by £137m and its full year profit guidance by £40m to £835m, as trading in the last seven weeks has proved “materially better” than the guidance it issued in May.
This comes as full price sales in the first seven weeks of the second quarter increased 9.3% compared with last year, beating its full price estimates by £93m.
The group has attributed its over-performance to a change in weather, as warmer weather came in after a wet and cold April.
In addition, annual salary increases delivered a “significant” uplift in real household income, as during April, annual inflation ran at 8.7% and monthly inflation at 1.2%.
As a result, the retailer “does not think it is a coincidence” that sales stepped forward so markedly at a time of year when many organisations make their annual pay awards.
Despite raising its profit guidance, the group does not anticipate the current performance to continue at the same level going forward, albeit having “moderately improved” its guidance for the rest of the year.
This revised guidance increased Next’s full price sales for the full year by £137m – of which £93m has already been achieved.
Profit before tax for the full year is now also expected to be £835m, which is £40m higher than its previous guidance.
