High street fashion chain Next is set to join the elite group of retailers that make more than £1 billion profit after a stronger than expected start to Autumn trading.
The company upgraded its profit guidance for the current financial year from £995 million to £1.005 billion in a trading statement issued today.
Next said full price sales in the third quarter to October were 7/6% up on last year, well ahead of previous guidance of 5%.
Bosses led by CEO Lord Wolfson believe the outperformance was due to a spell of cold weather in September that persuaded consumers to start getting in coats and knitwear for the dark months ahead.
This was in contrast to 2023 when a warm September and early Autumn slowed down sales of Autumn ranges.
Guidance for sales growth in the fourth quarter has been raised from 1% to 3.5%.
The faster rate of sales growth will add £43 million to revenue and £10 million to profit.
Only a handful of British retailers have made profits running to ten figures. The country’s biggest supermarket chain Tesco is also its most profitable retailer with pre-tax earnings of £2.3 billion last year. Sainsbury’s, which is enjoying a successful spell under current leadership, is on course to hit underlying operating profit of £1 billion for the first time this year.
Marks & Spencer famously broke the £1 billion barrier twice, once in1998 and again in 2008, but has struggled to get close to the mark ever since.
Among non-food retailers only JD Sports is in danger of bothering the £1 billion mark. Despite a troubled start to 2024 it believes it is still on track to hit the figure,
