Next PLC - Trading Statement
Trading Statement for Quarter 2
HEADLINES
Sales Growth
Full price sales1 in the second quarter were up +9.2% versus last year. This was materially ahead of our forecast for the period of +4.0%.
Performance Versus Guidance
Sales were
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The weather in the |
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The release of some pent-up demand in the |
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We were able to spend much more on profitable marketing than we had anticipated. |
Upgrade to Full Year Profit Guidance
We are increasing our full year pre-tax profit guidance2 by
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The addition of |
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The performance of our equity investments has been better than expected and we are increasing our forecast for full year profit by |
Rest of Year Sales Guidance
We are maintaining our guidance for full price sales for the rest of the year to be up +5.0% versus last year.
1. Full price sales include all items sold in Retail Stores and Online, including third-party brands, plus NEXT Finance interest income, but excludes Sale events, Clearance, Total Platform commission and the sales from subsidiaries. Note, last year's financial year included a 53rd week, so product sales comparisons are given against the corresponding 'offset' weeks last year; i.e. for Q2 we are comparing weeks 14-26 of this year with weeks 15-27 of last year.
2. Guidance for NEXT Group profit before tax excludes: (1) the cost of brand amortisation and (2) the profit attributable to shares that we do not own in subsidiary companies. In the prior year an exceptional property profit of
FULL PRICE SALES PERFORMANCE BY BUSINESS DIVISION
Our full price sales performance versus last year, by business division, is set out below by quarter and for the first half.
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Full price sales by division versus last year |
Q1 13 wks to 2 May |
Q2 13 wks to 1 Aug |
H1 26 wks to 1 Aug |
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+5.8% |
- 1.2% |
+2.1% |
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+15.7% |
+13.2% |
+14.4% |
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+10.1% |
+5.0% |
+7.4% |
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Retail Stores |
- 3.4% |
- 0.3% |
- 1.7% |
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TOTAL |
+4.4% |
+2.8% |
+3.6% |
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TOTAL ONLINE INTERNATIONAL |
+12.8% |
+36.9% |
+23.9% |
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TOTAL PRODUCT FULL PRICE SALES |
+6.5% |
+9.7% |
+8.1% |
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NEXT Finance interest income |
+0.9% |
+0.9% |
+0.9% |
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TOTAL FULL PRICE SALES |
+6.2% |
+9.2% |
+7.7% |
FULL PRICE SALES GUIDANCE FOR THE SECOND HALF
We are maintaining our guidance for sales for the rest of the year to be up +5.0% versus last year, as set out below.
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Full price sales by division versus last year |
Q1 (Actual) |
Q2 (Actual) |
H1 (Actual) |
H2 (Guidance) |
Full year (Guidance) |
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+4.4% |
+2.8% |
+3.6% |
+2.8% |
+3.2% |
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International |
+12.8% |
+36.9% |
+23.9% |
+14.0% |
+18.8% |
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NEXT Finance interest income |
+0.9% |
+0.9% |
+0.9% |
+1.9% |
+1.4% |
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TOTAL FULL PRICE SALES |
+6.2% |
+9.2% |
+7.7% |
+5.0% |
+6.3% |
In the
Growth in International sales in H2 is expected to moderate to +14%. This is because in August last year we achieved a one-off step change in our aggregator sales when we switched to ZEOS distribution services, materially increasing stock availability in our European aggregator business. So our comparative numbers become tougher from August onwards.
REVISED FULL YEAR GUIDANCE
Our revised guidance for the full year is summarised below, along with our previous guidance which is shown in grey.
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New guidance |
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Previous guidance |
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Guidance for the full year 2026/27 |
Full year (e) |
% Versus 2025/26 |
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Full year (e) |
% Versus 2025/26 |
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NEXT full price sales |
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+6.3% |
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+5.0% |
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Total Group sales3 (inc. markdown & investments) |
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+6.6% |
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+4.6% |
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NEXT Group profit before tax |
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+7.3% |
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+5.2% |
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Post-tax Earnings Per Share |
812.9p |
+9.2% |
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792.9p |
+6.5% |
EARNINGS PER SHARE AND SHARE BUYBACKS
Our guidance for Earnings Per Share assumes that we complete
Share buybacks are subject to us achieving a minimum 8% equivalent rate of return (ERR) on the purchase. ERR is calculated by dividing (1) anticipated NEXT Group pre-tax profits by (2) the current market capitalisation4. Based on our latest guidance, our share price limit for buybacks is
In the event we cannot spend all of the remaining
INTERIM RESULTS
We are scheduled to announce our results for the first half of the year on Thursday
Forward Looking Statements
Certain statements in this Trading Update are forward looking statements. These statements may contain the words "anticipate", "believe", "intend", "aim", "expects", "will", or words of similar meaning. By their nature, forward looking statements involve risks, uncertainties or assumptions that could cause actual results or events to differ materially from those expressed or implied by those statements. As such, undue reliance should not be placed on forward looking statements. Except as required by applicable law or regulation, NEXT plc disclaims any obligation or undertaking to update these statements to reflect events occurring after the date these statements were published.
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Date: |
Embargoed until 07:00 hrs, Wednesday |
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Contacts: |
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NEXT PLC |
Tel: 0333 777 8888 |
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Email: next@rowbellpr.com |
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Rowbell PR |
Tel: 020 7717 5239 |
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Photographs: |
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3. Total Group sales are the sum of total sales (full price and markdown) from all of the Group's divisions plus revenue from subsidiaries and investments. Revenue from subsidiaries and investments is based on our share ownership, e.g. we own 74% of Reiss so we report 74% of their sales. Group sales are not statutory revenue.
4. Market capitalisation is calculated based on shares in circulation, so excludes shares in the NEXT ESOT.
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