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Next's profit halves after pandemic shutters stores

LONDON: British fashion retailer Next on Thursday reported a halving in annual pretax profit after COVID-19 lockdowns closed its stores but raised its forecast for a big rebound this year.

Profit before tax of 342 million pounds (US$471 million) for the year to end January was in line with company guidance but down from 729 million.

With most of Next's stores closed for a significant portion of the year, group sales fell by 17per cent to 3.6 billion pounds.

Yet Next has shown resilience during the crisis, benefiting from its long-established online operation.

Rivals with weaker or no online business, notably Primark, have seen far larger falls in sales. Others, such as Topshop-owner Arcadia, and Debenhams have collapsed.

In the first eight weeks of the current financial year, Next said online sales had been stronger than expected and up more than 60per cent on two years ago.

The group raised its central guidance for profit before tax for 2021-22 to 700 million pounds from 670 million.

It maintained its forecast for flat full price sales versus 2019-20 - a two-year comparison.

Shares in Next, up 11per cent in 2021, closed Wednesday at 7,866 pence, valuing the business at 10.4 billion pounds.

(US$1 = 0.7268 pounds)

(Reporting by James Davey; editing by Guy Faulconbridge and Jason Neely)

Source: Reuters

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