Industry reacts to NEXT results: "It looks to be in a much stronger position than rivals to weather any storm" - Indoors Beauty

Industry reacts to NEXT results: "It looks to be in a much stronger position than rivals to weather any storm"

Industry reacts to NEXT results: "It looks to be in a much stronger position than rivals to weather any storm"

NEXT has maintained its steering for the full-year, regardless of a decline in full-price gross sales for the primary quarter ending 29 April 2023.

The retailer’s full worth gross sales dropped 0.7% in the 13 weeks, which was barely forward of its expectation of two% decline. Bricks-and-mortar gross sales had been down 0.6%, whereas on-line gross sales dropped 1.6%.

To preserve its first half steering, the retailer has moderated its gross sales forecast for the second quarter, which is now deliberate to be down 5% on final yr. Its earlier steering was a drop of 4%.

NEXT additionally stated it will preserve its gross sales and revenue steering for the full-year, with gross sales anticipated to lower 1.5% and revenue earlier than tax anticipated to whole £795 million.

TheIndustry.style has gathered commentary from consultants and analysts to gauge their response and achieve perception into how the longer term looks for the excessive road big.

Charlie Huggins, Manager of the ‘Quality Shares Portfolio’ at Wealth Club:

“This is one other strong replace from the bellwether of the UK excessive road. Sales have fallen by much less than anticipated, and though NEXT hasn’t elevated its full yr steering, this appears to be borne extra out of prudence than anything.

“The present retail surroundings is sorting the wheat from the chaff. On the one hand you could have the likes of Superdry, Boohoo and ASOS that are actually struggling, not to point out numerous different retailers which have gone bankrupt. At the opposite finish of the spectrum are the likes of NEXT and Primark, which seem to be getting stronger.

“NEXT’s power is permitting it to snap up weaker rival’s manufacturers (like Made.com) at knock-down costs and plug them into its on-line distribution community. By providing these manufacturers, NEXT expands selection for purchasers and offers them much more causes to maintain coming again.

“Overall, NEXT is doing all the things traders may ask of it in a tough retail surroundings. Economic pressures may but worsen as larger rates of interest actually begin to chunk. But that will not fear NEXT too much. It looks to be in a much stronger position than rivals to weather any storm.”

Wes Wilkes, CEO at Net-Worth Ntwrk:

“NEXT, like many companies on the excessive road, understandably has a few nerves given present market situations. It is cautious concerning the second quarter as it’s involved about its potential to repeat the stellar income generated in the identical interval in 2022, which was buoyed by heat weather and pent-up demand for weddings and different pandemic-deferred occasions.

“A extra muted year-on-year second quarter is predicted with a moderated forecast for decrease development, due to the headwinds going through the excessive road brought on by stubbornly excessive inflation and rising rates of interest.”

Samuel Mather-Holgate of Mather & Murray Financial: 

“Retail prospects had been driving a onerous discount, with NEXT having to low cost closely throughout this era particularly in contrast to final yr.

“Even with these reductions, NEXT had to depend on extra worthwhile shopper finance merchandise to maintain up weak gross sales information. This isn’t surprising, however is but extra proof that the economic system is fragile. There’s a actual likelihood that that yet another Bank of England base fee rise may break it and hit the excessive road onerous.”

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