Next has raised its full-year profit guidance after witnessing a better than expected sales performance over Christmas.
The clothing and lingerie retailer, which warned in November that trading was “extremely volatile”, said in a trading statement that overall sales rose 1.5% in the 54 days to December 24. A fall of 0.3% had been forecast.
Next raised its profit guidance for the year by £8m to a range of between £718m to £732m.
The company cautioned that subdued consumer demand driven by a decline in real income, the increase in experiential spending at the expense of clothing and inflation in cost prices remain challenges for 2018.
But Next is optimistic that some of these headwinds will ease as we move through the year.
“We already know that cost price inflation will reduce to 2% in the first half and believe it will disappear in the second half. We are budgeting for full price sales next year to grow by between -2% and +4%. The mid-point of +1% represents a modest improvement on this year’s anticipated growth of +0.3%,” the retailer said in a statement.
Next will publish its results for the full year on Friday, March 23.