Next Plc, the British retailer, has once again boosted its profit outlook for the current fiscal year. The company now expects pretax profit to reach $1.7 billion (£1.22 billion), a slight increase from its previous forecast. This revision comes after stronger-than-expected full-priced sales, which were up 6.2% in the 13 weeks to May, significantly higher than the 4% initially predicted. The retailer cited exceptionally strong growth in the first five weeks of the financial year, with sales climbing 11.8%.
For the full financial year, Next now forecasts full-price sales growth of 5%, an improvement from the prior estimate of 4.5%. This growth is expected to be driven by a 2.8% increase in UK sales and a substantial 14.4% rise in international sales. Despite these positive sales figures, Next is facing increased costs due to disruptions in the Middle East, with the crisis now projected to cost the company $47 million, up from an earlier forecast of $15 million, primarily due to higher transportation and fuel expenses.
To mitigate these rising costs, Next plans to implement price increases of no more than 8% in its overseas markets, with these changes expected in May. For the UK, the company anticipates offsetting extra costs through savings and margin gains, with no price increases beyond the 0.6% forecast at the beginning of the financial year. Shares in Next rose 0.6% to 12,705.00 pence each in London following the announcement. The company's strong performance comes even as it accounts for continued disruption in global transport networks and fuel costs.
