Next raises profit guidance as festive sales beat expectations
It has estimated that the rise in employers’ National Insurance and national minimum wage will add £67m to its tax bill
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Next has revealed that it has raised its full-year pre-tax profit guidance by £5m up to £1.01bn after a better than expected quarter.
In this quarter, full price sales rose 6% in the nine weeks to 28 December, beating the previous guidance for the fourth quarter of 3.5%.
It stated that its online performance had outperformed its retail stores, with revenue via its website increasing 6.1%, driven by a 9.2% jump in its label third-party platform.
The retailer’s overseas division saw sales “accelerate in the run up to the holiday period”, rocketing 31.4% in the nine weeks.
However, Next has cautioned that its growth in the UK is likely to slow as a result of upcoming tax rises.
It has estimated that the rise in employers’ National Insurance and national minimum wage will add £67m to its tax bill.
The retailer hopes to mitigate the “unusually high” increase through raising prices on like-for-like goods by 1%, alongside operational efficiencies and other cost savings.
