Next 'Over-Performs' in Q1 Due to Poor Comparables

Next has reported on first-quarter sales performance to 27th April 2019.

Excerpts from the trading update follow:

- Full price sales in the thirteen weeks to Saturday 27 April were up +4.5% on last year.
- This was +1.3% ahead of our internal forecast of +3.2% for the first quarter.

We believe this over performance versus forecast was mainly as a result of unusually warm weather over the Easter holiday period, which was particularly helpful to our Retail stores.

As expected, we experienced strong sales growth during February because sales were adversely affected by extreme winter weather last year. March was broadly in line with our forecast for the full year and, as mentioned above, sales during April were better than expected.

Full price sales (VAT exclusive) 13 weeks to 27 April:
Retail ‐ 3.6%
Online +11.8%
Product full price sales +4.0%
Finance interest income +11.4%
Total full price sales including interest income +4.5%
Of which sales from new space +0.3%

FULL PRICE SALES AND PROFIT GUIDANCE FOR THE FULL YEAR

We do not currently believe that the over performance of the first quarter can be extrapolated through to the rest of the year.  The overperformance in the first quarter amounted to sales of around  £10m.  Given this is a relatively small number in the context of annual sales, we believe it is too early to revise our full-year sales and profit guidance. 

Central Guidance on Full year estimate to January 2020:

Retail sales (including sales from new space) versus 2018/19: ‐8.5% Online sales versus 2018/19: +11.0%
Finance interest income versus 2018/19: +9.9%
Total full price sales versus 2018/19:  +1.7%
Group profit before tax1: £715m
Group profit before tax versus 2018/19:  ‐ 1.1% Earnings Per Share growth versus 2018/192: +3.4%

Source : Next

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