The Guardian: Next reports ‘dramatic’ rise in sales in Christmas run-up

The fashion and homeware chain said that full-price sales stepped up dramatically, rising by 10% in the last two weeks before Christmas. As a result, sales rose by 5.7% in the nine weeks to 30 December, far better than the 2% expected.

It is the fifth time in seven months that Next has increased its profit forecast.

Next said it had performed particularly well online after it improved its service, with sales rising by 9.1% in the three months to the end of December. Sales in stores rose by 0.6% after a fall in the prior quarter.

The retailer, led by longtime chief executive Simon Wolfson, said it now expected to make full-year profits of £905m, £20m more than previously hoped.

The company said it expected full-price sales to rise by 2.5% in the year ahead and up 6% in total, including new brands such as Gap and Reiss and discounted goods.

The stronger-than-expected trading figures will lift hopes for retailers over the festive season in which shoppers were thought to be cutting back on buying clothing amid tight household budgets and renewed interest in travel.

However, the upbeat mood was offset by a profit warning from JD Sports which said that mild weather in the early autumn and higher-than-expected levels of discounting in the run-up to Christmas had both hit sales.

The company said it did not expect to make more than £935m in profits, 10% below its previous guidance of £1.04bn.

Régis Schultz, the new chief executive of the JD Sports Fashion group, said: “Our key markets have seen increased promotional activity during the peak trading season, driven by a more cautious consumer, but we continue to grow market share. We are confident in our strategy and we continue to invest in our supply chain, systems and stores, supported by our strong cash generation and healthy balance sheet.”