Autumn's chill blew in favour of Next as the group upped its profit forecast for the third time in three months, putting it on course to join the elite band of retailers to make more than £1 billion in annual profits.
Full-price sales during the three months to October 26 rose by 7.6%, well ahead of expectations of a 5% increase, thanks to the “early arrival of colder weather this year, versus an unusually warm September and early October last year”.
As a result, the group has increased its full-year pre-tax profit guidance by £10 million to £1.01bn, marking a 9.5% rise on profits in 2023-24. Annual full-price sales are expected to come in at £5.02bn.
Total UK sales climbed by 5.8% during the period, while total UK online revenues were up almost 8%. Total online growth was up by more than 20%, driven by overseas sales.
Next is pencilling in more muted sales growth of 3.5% in its festive quarter to the end of January, as it said some trading will have been “pulled forward” into the third quarter.
Analysts at RBC praised Next’s operational efficiency and its “well-developed customer base" which has allowed the group to maintain strong sales even amidst a slower UK economy.
Only a handful of UK retailers have made profits running to ten figures, the leader being supermarket chain Tesco with pre-tax earnings of £2.3bn last year. Fellow grocery chain Sainsbury’s is also on course to hit underlying operating profit of £1bn for the first time this year.
Marks & Spencer famously broke that barrier twice, once in 1998 and again in 2008, but has struggled to get close to the mark ever since. Among non-food retailers, JD Sports believes it is on track to hit the £1bn mark despite a troubled start to the year.
Shares in Next were trading more than 1.5% higher as of late this morning.
Scottish alcohol-free beer brand partners with UK’s biggest pub group
A Scottish alcohol-free beer brand is celebrating a nationwide listing in the UK’s largest pub group.
Days Brewing in Edinburgh has gained a national listing for its 0.0% lager and pale ale with Stonegate. The launch comes off the back of a 12-month period in which Days has enjoyed more than 100% year-on-year growth, gained a listing in Sainsbury’s, and increased its distribution in Tesco and Waitrose.
Read the full story here.
'One of most interesting new distilleries in whisky' seals major deal
A Scotch whisky distillery is to start exporting to the US for the first time after sealing an exclusive import agreement.
Holyrood Distillery, which describes itself as one of the first distilleries to produce whisky in Scotland’s capital city in more than 100 years, has done a deal with Florida-based importer, Sacks Dynamic Operations (SDO).
It said the alliance will bring its “innovative” whiskies to the US market through a network of select retail stores across the country and SDO’s online marketplace, ScotchDrinkersOnly.com.
Read the full story here.
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