Next profits boosted by warmer weather

The chain increased its profit guidance by £15m to £825m

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Next has said warmer weather is the reason behind improve profit forecasts for the year after it surpassed sales estimates in the first half.

Britain's second-largest clothing chain increased the mid-point of its full year profit guidance by £15 million to £825 million and raised its estimates for sales growth.

It now expects to make full-year profit before tax of between £805 million and £845 million on sales growth of between 3.5% and 6%.

Its first half sales rose 3.5%, with 1.7% of that coming from new stores.

"We believe the improvements experienced at the end of the season were mainly driven by warmer weather," the company said in a statement.

The retailer, which has outdone competitors thanks to its strong online operations, diversification into new product areas and overseas expansion, also said it would pay a special dividend of 60p per share.

Next shares were up 1.3% to 7600p in early trading.

Hargreaves Lansdown's Richard Hunter said: noted that the company did not raise guidance for its second half and “remains typically cautious for the period on the back of the volatility of consumer demand”.

He added: “There are the inevitable concerns of competition within this fickle sector, let alone Next’s ability to surprise positively becoming harder to achieve.”

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