Next profits jump 5.7% to £870m amid anticipation of future decline

Next has announced that its pre-tax profits rose 5.7% to £870m, up from £823m, for the year ended 31 January 2023.

This number was £10m above the retailer’s guidance which it put down to strong sales in both its retail and total platform businesses.

Furthermore, the company’s total trading sales were £5.1bn, a rise of 8.4% compared with 2021 when total sales were £4.7bn.

Alongside this the company’s acquisitions of Reiss, JoJo Maman Bébé, Sealskinz, Joules, MADE.com, Swoon, Aubin, alongside stakes in the UK franchises for Victoria’s Secret and GAP netted the group £16.8m.

However, online sales for the retailer dropped 2% to £3bn compared with 2021.

Despite the positive results Next has stated that its sales for next year will drop around 1.5% and profits would drop £75m.

The retailer did follow this by stating that the businesses’ growth could return “once the cost of living crisis passes”.

Next chairman Michael Roney said: “It has been a good year for Next. We have embraced the various challenges and seized the opportunities that have arisen. We have prepared (and budgeted) for a difficult year. We are very clear on our priorities.

“If we continue to improve our product ranges, relentlessly manage our costs and upgrade our customer service, whilst also developing new business opportunities; we can lay the foundations for an exceptionally strong business and still deliver healthy profits, cash flow and dividends.”