Next ups guidance after boom in Directory sales
Fashion retailer Next said Next Brand sales for the first half of the financial year were up 10.7%, of which 2.4% came from the opening of profitable new space. Next Retail sales were up 7.5% and Next Directory was up 16.2%.
Sales are currently ahead of the 5.5% - 9.5% full year growth guidance given in April. Next is therefore raising and narrowing the sales guidance range for the year to 7% - 10%.
It might appear overly cautious to forecast a full year sales range which is below the current rate of growth. However, last year's first two quarters were hampered by a particularly cold Spring and Easter which presented a soft comparison for this year. This pattern makes estimating second half sales particularly difficult so guidance for the next six months is for growth of between 4% and 10%.
As a result of the better than expected first half performance, the group is raising its profit guidance by £25m.
Next has now paid or declared £223m of special dividends and also returned a further £105m through share buybacks, for a combined total of £328m so far this year. It does not anticipate paying any further special dividends in the current year.
The mid-point of the profit before tax guidance is now £795m and accordingly Next is increasing the buyback share price limit to £66.
Next will release Interim Results for the 26 weeks to 26th July, on Thursday 11th September.
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