Next hikes full-year outlook again after sales surge and profits swell to £347m
Fashion giant Next has hiked its full-year outlook once more after surging sales, but warned over rising prices and staff shortages in the run-up to Christmas.
It said supply chain woes had seen higher freight costs push up prices by about 2 per cent in the first half and cautioned this would continue into next year.
Next added that it was also seeing some areas of the business come under pressure from staff shortages, particularly in logistics and warehousing, and may see “some degradation in our service in the run-up to Christmas” unless immigration rules are relaxed.
The comments came as the group reported pre-tax profits of £347m for the six months to July 31, up 5.9 per cent 2019 levels, after full-price brand sales jumped 62% and were 8.8% higher versus two years ago.
It increased its full-year sales and profit forecasts again after a “materially” better-than-expected performance over June and July, when full-price sales soared 20% against 2019 levels, while it said the second half had also got off to a strong start.
The group now expects sales to rise 10 per cent on 2019 levels and pre-tax profits to reach £800m for the year to January, up 6.9 per cent on 2019 and above previous guidance of £764m.
Next called on the Government to take action on the lorry driver crisis and wider skills shortages.
It said: “The HGV crisis was foreseen and widely predicted for many months.
“For the sake of the wider UK economy, we hope that the Government will take a more decisive approach to the looming skills crisis in warehouses, restaurants, hotels, care homes and many seasonal industries.
“A demand-led approach to ensuring the country has the skills it needs is now vital.”