Falling revenues are Next on the agenda for high street

Fashion retailer Next is set to be the next high street stalwart to show the scars of tougher trading conditions when it is expected to post another fall in quarterly sales this week.

Next is due to unveil its quarterly sales on Wednesday. Picture: Ian Georgeson

Analysts at Santander forecast a 4.5 per cent slide in Next brand sales for the autumn quarter, which included an unseasonably warm September.

They have pencilled in a flat performance for the company’s directory business and a 7.6 per cent fall in revenues at the stores. The City also believes a disappointing sales performance by Next when it reports on Wednesday could hit shares in other retailers quoted on the stock market as the company is seen as one of the most consumer-savvy operators on the high street.

In September Next ann­ounced a 1.5 per cent decline in profits to £342 million for the six months to end-July, dragged down by a 16.8 per cent slide in earnings across its bricks-and-mortar operations.

At that time, Next chief executive Lord Wolfson said trading remained “challenging and volatile”.

He said any recovery would not come before “mid-October at the earliest”, and has also warned that the rest of 2016 for retailers “may well feel like walking up the down escalator”.

Wolfson has also said that Next will have to hoist its prices by up to 5 per cent next year to deal with currency-based cost increases.

Sterling has slumped against both the US dollar and euro since last June’s vote by Britain to quit the European Union – hitting retailers’ input costs.

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