Fashion chain Next has raised its profit prediction
Fashion retailer Next upped its full-year profit guidance by £25m after better-than-expected first-half sales, leaving it on course to extend its lead over Marks & Spencer.
The group overtook its rival with a £695m profits haul earlier this year and said it was now on course to lift this to between £775m and £815m – with analysts expecting M&S to make £663m.
Shares rose 2% after Next said sales for the first half to July 26 were 10.7% ahead, with 2.4% coming from new space.
Retail sales rose 7.5% – though this increase was slower in the second quarter than the first. The group's catalogue and online division boosted revenues by 16.2%, including a stronger second quarter.
The company said sales were ahead of its 5.5%-9.5% full-year guidance and that it was raising this range to 7%-10%.
Next said the guidance "might appear overly cautious" but pointed out that the first-half performance compared with a period last year when sales were hampered by cold spring and Easter weather.
It said the final quarter of the year would be a "challenging comparison".