Jan 3, 2018

Next credits cold snap as Christmas sales beat forecasts

Next credited a snap of cold weather for better than expected Christmas sales, in a rare note of optimism from the clothing chain whose falling profits and declining in-store sales have been seen as a harbinger of gloom on Britain's high streets. That improvement, which compared with the company's forecast of a small decline, allowed Next to pare back the amount of discounted stock in its Christmas sale, lifting the company's profit forecast by 1 per cent, to £725m. Next's share price rose almost 7 per cent on Wednesday morning to £48.06. Sales in Next's physical stores are declining even as the company keeps opening new ones - although the 6.1 per cent reversal in the weeks before Christmas marked an improvement from the 7.7 per cent decline earlier in the year. Rising wages and other operational costs meant that even if the recent positive sales trend continued, profits would be down slightly next year, the company said. Next had warned that it was expecting a weak Christmas season after struggling with "Extremely volatile" trading during much of the second half of 2017.

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