Next boosts forecasts after bumper Christmas sales beat expectations
The retailer said its Christmas sales were boosted by a ‘much colder November than last year and improved stock availability’.
Retailer Next has increased its profit forecast for the past year after posting higher sales than predicted in last two months of 2019.
The high street fashion business shrugged off the recent malaise affecting retailers to post a 5.2% increase in sales for the period to December 28, which it said was 1.1% ahead of company forecasts.
Next said it believes its sales for the Christmas period were boosted by a “much colder November than last year and improved stock availability” in both retail stores and online.
Meanwhile, full-price sales for the 11 months to the end of December rose by 3.9% as the retailer also predicted sales growth would surpass previous expectations.
This was an impressive end to the year as their outstanding online business continues to set them apart from the competition Richard Lim, chief executive of Retail Economics
It said it expects sales to continue to be 3.9% higher by the end of the financial year, January 31, up from the previous guidance of 3.6% growth for the year.
Total sales in retail stores slipped 4.6% over the year-to-date, while they were 3.9% lower for the two months to December.
However, Next was buoyed by continued online growth, as digital sales rose 12.1% for the year-to-date, driven by a 15.3% jump in the most recent period.
Simon Wolfson, chief executive of the retailer, said high street sales were ahead of forecasts before Christmas, although Boxing Day performance was below expectations.
He told PA: “We were broadly in line with expectations across the board but were helped by the weather in November and improved stock availability.
“We had better sales of our winter clothing products than we expected.
“Boxing day was disappointing, which was mainly because of the weather. It was raining virtually all day and it was around 5% below expectations, but we shouldn’t exaggerate the impact of that as it was not too dramatic.”
The company said it now expects to post a full-year profit of around £727 million, raising its previous forecast by £2 million.
Richard Lim, chief executive of Retail Economics, said: “This was an impressive end to the year as their outstanding online business continues to set them apart from the competition.
“The retailer is benefiting from years of investment in their digital proposition, continually evolving their business model to meet shoppers’ heightened expectations.”