British clothing retailer Next’s sales performance on Christmas Eve on Thursday exceeded expectations. Their profit benefited from the recovery in demand for adult formal and casual wear. Next raised its full-year profit forecast for the fifth time in 10 months.
Next, conducts transactions in approximately 500 stores and online. The company said that full-price sales increased significantly in the eight weeks ending December 25. They experienced a 20% rise compared to the same period in 2019-20 before the pandemic affected transactions. In contrast, the guidance increased by 10.2%.
It forecasts a pre-tax profit of 1.1 billion US dollars for the full year 2021-22, which is higher than the previous guidance of 800 million pounds and an increase of 9.8% from 2019-20.
Next is the first major UK retailer to update Christmas deals. It set a high standard for its competitors. The strong online performance was enough to offset another drop in in-store sales.
Online sales increased by 45%, while retail sales in the UK and Ireland fell by 5.4%.
The group had expected sales growth in the fourth quarter to be weaker than in the third quarter.
However, it stated that the strong recovery of Next brand adult formal wear and occasional wear has significantly increased sales throughout the period.
Next Has Proven to Perform Well During the Pandemic Thanks to Its Long-Established Online Business
Next stated that its initial guidance for 2022-23 is for full-price sales to increase by 7% compared to the current 2021-22 year ending in January 2022. It estimates that its pre-tax profit will increase by 4.6% to 860 million pounds.
The organization stated that consumer financial pressures indicate a tougher trading environment in 2022.
Due to rising freight rates and increased manufacturing costs, its prices will increase by 3.7% in the first half of the year and 6.0% in the second half.