Next PLC (LSE:NXT) upgraded sales guidance for the fourth time this year after its recent performance topped expectations.
The FTSE 100 group forecast a 10% increase in full-year sales compared to 2019 levels with profit before tax estimated to rise 7% to around £800mln. Year-end net debt is forecast at £610mln, a reduction of £502mln against two years ago.
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Sales surged 20% in the last eight weeks compared to the same period in 2019 after stores performed better than expected, while online fell back less than forecast.
The retailer has been helped by pent-up demand for clothing, record savings after lockdowns and the ‘staycation’ trend in the UK, so said the strong trading may slow down over the next few months.
Next is also grappling with supply chain issues and expectations of labour shortages in the busy Christmas months.
In the half-year ending 31 July, brand full-price sales jumped 8% to £2.1bn compared to 2019 with total group sales up 7% to £2.2bn.
Online sales rocketed 52% to £1.5bn and retail dropped 38% to £540mln due to store closures. Full-year profit before tax advanced 8% to £289mln.
Following the special dividends announced earlier this year, Next plans to return to ordinary dividends in the financial year to January 2023.