Next beats Marks & Spencer again as it raises profit forecast

Next’s second-quarter sales were up 10.7%

Fashion giant Next put rival Marks & Spencer in the shade again today as chief executive Simon Wolfson raised its profit forecast following a strong quarter.

While M&S struggles with poor sales, the sudden loss of its finance director and increased grumbles over the leadership of Marc Bolland, Next has made hay in the sunshine, lifting its profit forecasts by £25 million to between £775 million and £815 million.

Next’s shares, up 140p to 6660p on the back of the upgrade, have added 23 per cent since the beginning of 2014, compared with a miserly 2 per cent advance for M&S.

It has also handed back £328 million to investors through special dividends and buybacks this year.

“This summer has been quite a good summer for clothing retail in that it has been warm. The weather has been on our side for the last four or five months,” said Wolfson.

Group sales are ahead of Next’s April guidance of between 5.5 per cent and 9.5 per cent and the retailer also upped its sales range for the year to between 7 per cent and 10 per cent.

Next has been flattered by trading comparisons with last year’s much colder weather and Wolfson expects the going to get tougher as the financial year progresses.

The hotter temperatures this year have also meant less pressure on clothing retailers to slash prices across the board, pushing up the nation’s overall inflation rate to 1.9 per cent in June and dampening official retail sales figures.

Despite the economy picking up strongly, Wolfson is cautious over the financial health of British shoppers.

He said: “My sense is that the consumer is OK but we are by no means in a boom situation. While people have stopped feeling poorer after five or six years, I’m not sure people are feeling a lot richer.”

Next’s second-quarter sales were up 10.7 per cent, including an 18.8 per cent increase in sales from the Directory online and catalogue business and a 6.4 per cent increase in High Street takings.

Peel Hunt analyst John Stevenson said Next’s rivals will face a tough job keeping up with Wolfson’s retail machine. He said: “While underlying apparel markets have been strong, Next is taking market share and we struggle to see M&S or Debenhams matching this level of performance.”

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Content Writer - Global Financial Services

£25000 - £30000 per annum: Recruitment Genius: From modest beginnings the comp...

Recruitment Genius: Web Developer - PHP

£35000 - £40000 per annum: Recruitment Genius: From modest beginnings the comp...

Recruitment Genius: Field Sales Consultant - Financial Services - OTE £65,000

£15000 - £65000 per annum: Recruitment Genius: This is an exciting opportunity...

Recruitment Genius: Loan Underwriter

£18000 - £20000 per annum: Recruitment Genius: This is a fantastic opportunity...

Day In a Page

The Silk Roads that trace civilisation: Long before the West rose to power, Asian pathways were connecting peoples and places

The Silk Roads that trace civilisation

Long before the West rose to power, Asian pathways were connecting peoples and places
House of Lords: Outcry as donors, fixers and MPs caught up in expenses scandal are ennobled

The honours that shame Britain

Outcry as donors, fixers and MPs caught up in expenses scandal are ennobled
When it comes to street harassment, we need to talk about race

'When it comes to street harassment, we need to talk about race'

Why are black men living the stereotypes and why are we letting them get away with it?
International Tap Festival: Forget Fred Astaire and Ginger Rogers - this dancing is improvised, spontaneous and rhythmic

International Tap Festival comes to the UK

Forget Fred Astaire and Ginger Rogers - this dancing is improvised, spontaneous and rhythmic
War with Isis: Is Turkey's buffer zone in Syria a matter of self-defence – or just anti-Kurd?

Turkey's buffer zone in Syria: self-defence – or just anti-Kurd?

Ankara accused of exacerbating racial division by allowing Turkmen minority to cross the border
Doris Lessing: Acclaimed novelist was kept under MI5 observation for 18 years, newly released papers show

'A subversive brothel keeper and Communist'

Acclaimed novelist Doris Lessing was kept under MI5 observation for 18 years, newly released papers show
Big Blue Live: BBC's Springwatch offshoot swaps back gardens for California's Monterey Bay

BBC heads to the Californian coast

The Big Blue Live crew is preparing for the first of three episodes on Sunday night, filming from boats, planes and an aquarium studio
Austin Bidwell: The Victorian fraudster who shook the Bank of England with the most daring forgery the world had known

Victorian fraudster who shook the Bank of England

Conman Austin Bidwell. was a heartless cad who carried out the most daring forgery the world had known
Car hacking scandal: Security designed to stop thieves hot-wiring almost every modern motor has been cracked

Car hacking scandal

Security designed to stop thieves hot-wiring almost every modern motor has been cracked
10 best placemats

Take your seat: 10 best placemats

Protect your table and dine in style with a bold new accessory
Ashes 2015: Alastair Cook not the only one to be caught in The Oval mindwarp

Cook not the only one to be caught in The Oval mindwarp

Aussie skipper Michael Clarke was lured into believing that what we witnessed at Edgbaston and Trent Bridge would continue in London, says Kevin Garside
Can Rafael Benitez get the best out of Gareth Bale at Real Madrid?

Can Benitez get the best out of Bale?

Back at the club he watched as a boy, the pressure is on Benitez to find a winning blend from Real's multiple talents. As La Liga begins, Pete Jenson asks if it will be enough to stop Barcelona
Athletics World Championships 2015: Beijing witnesses new stage in the Jessica Ennis-Hill and Katarina Johnson-Thompson heptathlon rivalry

Beijing witnesses new stage in the Jess and Kat rivalry

The last time the two British heptathletes competed, Ennis-Hill was on the way to Olympic gold and Johnson-Thompson was just a promising teenager. But a lot has happened in the following three years
Jeremy Corbyn: Joining a shrewd operator desperate for power as he visits the North East

Jeremy Corbyn interview: A shrewd operator desperate for power

His radical anti-austerity agenda has caught the imagination of the left and politically disaffected and set a staid Labour leadership election alight
Isis executes Palmyra antiquities chief: Defender of ancient city's past was killed for protecting its future

Isis executes Palmyra antiquities chief

Robert Fisk on the defender of the ancient city's past who was killed for protecting its future