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Next has raised its full-year profit guidance by £20m following a period of strong trading over the summer, as sales exceeded expectations despite the drearier weather.
In the second quarter of the year, full price sales were up by 3.2%, exceeding its expectations by £42m. It had initially expected Q2 sales to be down by 0.3% following the “exceptionally favourable” weather that boosted retail last summer.
In addition, total group sales rose by 8.0% in the first half of the year, in part driven by the acquisition of FatFace and an upped stake in Reiss. Full price sales over this period were up 4.4% against the prior year, despite the fact guidance for this period said they would be up by 2.5%.
Following these results, the group has raised its full-year profit guidance by £20m to £980m, up by 6.7% against last year.
The profit improvement came from additional sales of £11m, as well as cost savings of £9m, mainly found in logistics.
Looking ahead, total group sales for the full year are expected to rise by 6% year-on-year, 2.6% higher than its expected growth.
Next said it is maintaining its guidance for full price sales in the second half to be up 2.5%, however. It said that while this “might seem cautious when compared with the performance in the first half”, when compared to two years ago, growth in the first half and the forecast for the second half are “almost identical”.
