Fashion retailer Next has lifted its full-year profit guidance after warmer weather helped deliver a better-than-expected rise in sales.
The group said full-price sales for the six months to 25 July grew 3.5 per cent, beating its forecast of up to 3 per cent, despite “continued volatility” in consumer demand.
“We believe the improvements experienced at the end of the season were mainly driven by warmer weather,” Next said in yesterday’s trading update to investors.
As a result, the retailer has pencilled in growth of between 3.5 and 6 per cent for the full year, and lifted the upper end of its pre-tax profit forecast range to £845 million, up from £835m previously.
Next also said that it plans to pay a special dividend of 60p a share on 2 November. Half-year results will be published on 10 September.
Richard Hunter, head of equities at Hargreaves Lansdown, said: “Traditionally the company tends to manage expectations lower and subsequently outperform. This has again been the case in the first half, helped along by some warmer weather. Next has not as yet upped its second-half forecasts, and remains typically cautious for the period on the back of the volatility of consumer demand.
“Apart from the company’s own cautious outlook, there are the inevitable concerns of competition within this fickle sector.”