UK Retailer Next Expects to Join 1 Billion Pound Profit Club

Signage on the exterior of a Next clothing retail store is seen in London, Britain, March 25, 2023. REUTERS/Toby Melville/File Photo

Next said on Wednesday it expected to report annual profit in excess of 1 billion pounds ($1.3 billion) for the first time in its history, underscoring the success of the British clothing retailer.
The group raised its outlook again after a better-than-expected 7.6% rise in third quarter to Oct. 26 full-price sales, driven by the early arrival of colder weather this year, versus an unusually warm September and early October last year, Reuters reported.
Breaking through the 1 billion pound profit mark would cap Next's position as one of the best run retailers in Britain, having found a successful recipe combining more than 800 stores in the UK and Ireland and nearly 8 million online customers.
It also has nearly 2 million overseas customers buying through its website and many more who buy its products via third party websites, or so-called aggregators.
The strong performance, which puts it in the ranks of supermarket Tesco and clothing and food retailer Marks & Spencer as British retailers to have made a profit of over 1 billion pounds, has sent its shares up by 47% over the last year, hitting a record high in September.
The company, which is considered a useful gauge of how consumers are faring, raised its guidance for the fourth quarter by 1 percentage point to 3.5%. It was the third increase to its outlook in four months.
It said the improved sales in the third quarter along with its forecast for the fourth quarter added 43 million pounds to full-price sales and 10 million pounds to profit.
That took its profit guidance for the 2024-25 year from 995 million pounds to 1.005 billion.
Official data published earlier this month showed UK retail sales unexpectedly rose in September. However, other retailers have said shoppers remained nervous about spending on discretionary items ahead of the new Labour government's budget statement later on Wednesday.