Next PLC (LSE:NXT) shares finished flat on Thursday, with investors having already anticipated the retailer’s latest profit upgrade following a strong second quarter.
The group delivered another impressive set of figures, with full price sales up 10.5%, beating guidance by £49 million.
International sales were particularly robust, rising 26%, while the Label division grew 10%. Online sales for the Next brand increased by 9%, and in-store sales by 5.6%.
The upgrade marks Next’s third profit guidance increase this year, with expected full-year pre-tax profit now set at £1.1 billion.
Shore Capital notes that while UK growth has been boosted by warm weather and a cyber-attack at a competitor, the real story is the continued momentum overseas, driven by more effective digital marketing.
The company remains cautious on the UK, holding its second-half guidance to 1.9% growth, but has lifted its international sales forecast for the second half.
With the share price above its buyback threshold, any surplus cash is now expected to be returned via a special dividend early next year.
Next trades at a premium to the sector, but Shore believes this is justified by its consistent performance and global growth prospects.
The stock was static at 12,240p.