Next chief vows to hold prices in check

The boss of high street stalwart Next yesterday offered reassurance that prices will not head higher in 2012 after a “perfect storm” of surging costs and rising VAT increased price tags this year.

The retailer, which has more than 500 stores in the UK and Ireland, hiked average selling prices by 7 per cent in the six months to 31 July as soaring cotton and oil costs added to the VAT hike to 20 per cent in January.

Next expects selling prices to rise 8 per cent in the second half of the year, but chief executive Lord Simon Wolfson said there would be no further rises in the first half of 2012 as the cotton cost bubble has burst, with prices falling 50 per cent below their March peak.

The reassurance came as Next reported a 1.8 per cent dip in store sales, which was offset by a 15.1 per cent increase at its online business Next Directory.

The company posted an 8.5 per cent increase in half-year pre-tax profits to £228 million after revenues grew 3.6 per cent to £1.6 billion.

Investors will see their interim dividend rise 10 per cent to 27.5p per share.

VICTORIA THOMSON