Next boosted by online sales

High street fashion and homewear retailer Next has reported a “solid performance” in the first half of the year due to the growth of its directory business, which includes sales from its online and catalogue channels. The retailer reported that total sales

were up by 4.5 percent excluding VAT, in the first half of its financial year, compared to last year for the 26 weeks to July 28.

Whereas retail sales to July 28 increased by only 0.2 percent, helped by new stores outperforming existing ones and offsetting a low like-for-like performance, the retailer’s continuing focus to its multichannel offerings paid off as its Next Directory business was up 13.3 percent compared to last year, and was ahead of the retailer’s guidance of 9-12 percent.

Boosted by its online sales the retailer described the results as “another strong all round performance” and increased and narrowed its sales and profit guidance ranges for the full-year.

Following these results, the group expects brand sales growth of 2 percent to 4.5 percent for its full year and group profit before tax of 575 million Pounds to 620 million Pounds, up 2.6 percent on previous forecasts.

In the financial statement, the retailer also announced its intention to buy back approximately 200 million Pounds of shares this year, having already spent 112 million Pounds buying 3.9 million shares.

Commenting on the Next trading statement, James McGregor from retail consultants, Retail Remedy said: "In an extremely challenging retail environment, Next has done the right thing by focusing myopically on its core strengths and core customers, many of whom have grown up with the brand since its launch in the early eighties.

"Rather than chase the value end of retail, as so many retailers have done in recent years, Next has remained stubbornly in the middle ground and it has paid dividends. The success of the online and Directory channels reflects the trust people have in the Next brand — they know that the things they order will be of the quality they expect. That's no mean achievement on behalf of the retailer.”

Next will report its interim results for the 26 weeks to July 28 on September 13.