Next profit climbs to record high

High street clothing and homeware retailer Next has reported 5% growth in profit for the 12 months to the end of January 2024, to a record £918m.

This is £3m above the company’s earlier guidance of £915m, largely due to better than expected clearance of sale stock in January.

For the full year, full-price sales were up 4% and total group sales increased by 5.9% to £5.8bn.

In the coming year, rising wage bills are anticipated to cost Next around £60m, of which £25m is the difference between the expected rate of general UK wage inflation and the rise in the National Living Wage.

However, the retailer is planning a “small reduction” in selling prices due to lower manufacturing costs.

In its outlook for the year ahead, Next said that positive factors included wages rising faster than prices and no inflation in the company’s own products. Risk factors were a weakening employment market and consumers’ higher mortgage repayments.

“We’re not negative about the consumer outlook, it’s a first for us for some time,” chief executive Simon Wolfson told Reuters in an interview.

Next maintained its guidance for 2024/25, anticipating a 4.6% rise in profit to £960m.