Fashion chain Next say snow cost £22m sales
Fashion chain Next today said the snow cost it £22 million in lost sales as customers stayed at home during the key Christmas trading period.
The retailer estimated that 2.2% of the season's total sales were lost as a result of the snow, meaning like-for-like sales in its retail estate were down by 6.1% in the period between August and Christmas Eve.
While it also faced increased competitor discounting in the run-up to Christmas, Next said it remained on track to improve profits by as much as 10% in the year to the end of January.
Its online and telephone business, Next Direct, initially received a boost from the snow but this was offset nearer to Christmas when customers became worried that orders would not be delivered on time.
Sales at Next Direct were up 8.7% in the half-year, helping overall group sales to rise by 0.2% in the period.
Chief executive Simon Wolfson admitted that like-for-like retail sales were down by between 8% and 9% in the fourth quarter, mainly as a result of the bad weather.
But post-Christmas sales got off to a strong start, helped by the improved weather, he added.
"The end of season sale started well," he said. "There was a marked improvement in performance when the weather thawed out a bit."
The outlook for 2011 is uncertain as Next is unsure how consumers will react to the Government's budget cuts and price inflation.
The retailer expects the prices of goods it sells to rise by about 8% this year, partly as a result of soaring cotton prices and yesterday's VAT increase from 17.5% to 20%.
Mr Wolfson added: "The big uncertainty is the effect of rising prices on consumer demands, which will make it very difficult to know what 2011 will be like.
"We are working on the basis that prices will continue to rise for the whole of 2011."
Next expects its pre-tax profits for the year to January to be between £540 million and £555 million, which is in line with its previous guidance.
- 1 Nigel Farage: Me vs Russell Brand on Question Time – he's got the chest hair but where are his ideas?
- 2 Harry Potter fans can apply to the Hogwarts-inspired College of Wizardry
- 3 Jessica Chambers: 19-year-old woman 'doused with lighter fluid and burned alive' in the US
- 4 Russell Brand calls Nigel Farage 'poundshop Enoch Powell' in BBC Question Time debate
- 5 Orange Wednesdays are no more
Weather bomb in pictures: Storms cuts power for tens of thousands – and snow is on the way
Jessica Chambers: 19-year-old woman 'doused with lighter fluid and burned alive' in the US
Russell Brand calls Nigel Farage 'poundshop Enoch Powell' in BBC Question Time debate
Russell Brand was rendered speechless on Question Time by this man
Fury at Airbus after it hints the super-jumbo may be mothballed
Disgruntled RBS worker writes hilarious open letter to Russell Brand after anti-capitalist publicity stunt leaves him hungry
Nigel Farage defends Kerry Smith 'ch***y' comment: 'If you are going for a Chinese, what do you say you’re going for?'
Nigel Farage's approval rating hits 'record low' as popularity suffers in wake of Ukip sex scandal
Pakistan school attack live: Taliban kill at least 132 children in 'horrifying' massacre
Sony hack: Angelina Jolie branded 'seriously out of her mind' in further embarrassing leaked email saga
Panic Saturday: 13 million Britons spend £1.2bn – while 13 million others across the country live in poverty unable to afford food
iJobs Money & Business
$200 - $350 per annum: Carlton Senior Appointments: Managing Producer Office...
$125 - $225 per annum: Carlton Senior Appointments: San Fran - Investment Advi...
Up to £70,000 per annum + benefits: Sheridan Maine: Are you a qualified accoun...
Up to £65,000 per annum + benefits: Sheridan Maine: Are you a qualified accoun...