Online sales helped to lift Next sales over the summer and early autumn.
The multichannel fashion retailer said that largely online Next Directory growth of 5.6% in the third quarter helped it to overall growth of 2.7% even though retail sales were just 1.1% ahead of last year.
In the year to date, directory sales have risen by 10.4% and retail sales by 0.5%, but the difference between the two divisions narrowed in the most recent quarter. “We believe,” said Next in today’s interim management statement, “this is mainly because Directory has now annualised the significant benefits of the delivery improvements we made at the start of last year.”
Looking ahead the company predicted full year sales would come in at between 3% and 4.5% higher than last year, with group pre-tax profit rising to between £590m and £620m, which would mean overall sales growth of between 3.5% and 8.7%.
James McGregor, director of the retail consultants Retail Remedy, said: “There may be a brief pang of disappointment that their annualised Directory sales are not growing at the same extraordinary rate as before.
“By anyone else’s standards, 10% annualised growth is remarkable. But Next has set itself a very high bar – for a fashion retailer to deliver an annual profit of £600 million in the current environment is truly impressive.
“The company has no magic formula, just a tried and tested multiplatform approach. It perfected its holy trinity of online, directory and physical stores long before its rivals had even begun to look beyond physical stores.
“It understands its customers well, listens to them and reacts to their needs. The result is a loyal and trusting customer base.
“This is not alchemy. Artistry perhaps. But above all, Next’s success is the fruit of a clearly defined and well executed proposition.”
