Next PLC (LSE:NXT) issued a profit warning as cost-living pressures begin to impact the retail giant.
The company's guidance for full-year profit before tax, which was raised in a trading update in August by £10mln to £860mln, was cut to £840mln.
Full price sales are also expected to be 1.5% lower in the second half, with the FTSE 100 retailer lamenting the cost-of-living crisis which resulted in a below-expectations August.
“We think it is sensible to moderate our expectations for sales and profit in the second half,” it said in its interim results.
September trading, it said, had improved, and recent government measures which saw the pound plummet and led the Bank of England to intervene may bring some benefits.
Next stressed that there are so many variables, including energy, economic migration, tax and employment that predicting near-term sales is unusually difficult.
Investment in improving and extending its product offer, as well as the development and modernisation of its technology platform will not be slowed down by a “less benign environment”, it said.
For the six months to end-July 2022, Next said it had a “good first half.”
Brand full price sales were up 12.4% compared to the same period in 2021, with overall sales ahead of expectations, while profit before tax was up 16% to £401mln.