Next plc, Britain's second-largest clothing retailer, raised its full-year profit forecast after a solid, if not spectacular sales over the holiday period.
The Leicester, England-based group reported a 3.9 percent increase in pre-Christmas sales, during the period which ended on 24 December, and said its full-year profit forecast would come in at or near the upper end of its previously reported range of between £590m and £620m. In keeping with a developing trend, Next said online sales from its Directory home shopping unit were 11.2 percent higher than during the same period last year while sales at its 500 UK and Irish High Street stores were only 0.8 percent stronger. The group will report full-year earnings on 21 March.
"As expected, there has been little change to the consumer environment since our last trading statement on 31 October. Sales growth in the fourth quarter has been in line with the rest of the year and in line with the forecast we gave (in October)", the company said in a statement on its website. "Although sales have been in line with our expectations, cost control measures, mark downs and gross margins have all been slightly better than expected."
In keeping with a developing trend, Next said online sales from its Directory home shopping unit were 11.2 percent higher than during the same period last year while sales at its 500 UK and Irish High Street stores were only 0.8 percent stronger. The employee-owned John Lewis Partnership said Wednesday that sales in the five weeks ending on 29 December fell just shy of £690m, a 15 percent increase from last year. Online sales, the group said, rose 44 percent.
Several of Britain's biggest retailers started their online sales campaigns prior to the close of pre-Christmas trading in order to tap-in to the developing trend for digital bargain-hunting. Marks & Spencer plc begain online sales on Christmas Eve, following a similar move by rival Debenhams.
"Online sales growth accelerated as we took advantage of the investment that many retailers have made in giving us the flexibility we now demand around delivery options like click-and-collect and security," said British Retail Consortium Director General Helen Dickinson. "We now feel much more comfortable about putting our credit card number into our mobile phone, but overall this channel represents just over 10 per cent of total retail sales."
The BRC will publish its December sales monitor on 8 January.
Next shares rose more than 4.2 percent in early London trading to change hands at 3,932 pence each, the highest level on record. The shares have risen around 47 percent over the past year.