Proactive Investors - Next PLC (LON:NXT) has raised guidance for the second time in two months due to better than expected sales, lower costs and reduced inflationary pressures.
The flagship retailer now expects full-year pre-tax profit of £875 million, up from £845 million, which would represent annual growth of 0.5%.
In August, the Leicester-based firm which has a track record of under promising and over delivering nudged up its pre-tax prediction by £10 million from £835 million before.
Next has increased its full price sales guidance for the second half to be up 2.0% on last year, compared with previous guidance of 0.5%, which would take full year growth to 2.6%.
It also believes it can deliver £46 million more cost savings this year than originally planned.
Earnings per share is forecast to be 723.9p, up +3.2%, and the firm expects to book an exceptional gain of £110 million from the Reiss acquisition - a pure accounting gain and not included in the profit guidance.
Looking ahead to 2024/25 it is likely that inflationary pressures on selling prices and operating costs will continue to ease, Next thinks.
The guidance came alongside, results for the half-year to July 31, which saw sales rise 5.4% to £2.64 billion from £2.50 billion and pre-tax profit climb 4.8% to £420 million from £401 million. EPS edged up to 264.5p from 262.3p.
Next said sales were better than expected, its online service has significantly improved, costs are lower than expected and all three streams of new business are showing signs of promise.
Overseas, in particular, has taken a big step forward in the second quarter.