Clothing chain Next said warm weather over the Easter holiday drove a 4.5% rise in full-price first-quarter sales, beating its own forecasts of a 3.2% rise.
Next, which trades from more than 500 stores in Britain and Ireland, about 200 stores in 40 other countries and its Directory online business, said full-price sales from stores fell 3.6% in the 13 weeks to April 27, while online sales rose 11.8%.
“We always expected the first quarter to be good this year because it was hampered a lot by the weather last year, with all those blizzards, and then towards the end we were given a further boost by the very warm Easter,” chief executive Simon Wolfson said.
Next said the first-quarter outperformance amounted to about £10m (€11.6m) of sales, a relatively small number in the context of the year and not sufficient to change its outlook.
The group maintained sales and profit guidance for 2019 to 2020 of 1.7% full-price sales growth and a 1.1% fall in pretax profit to £715m.
Next’s shares, which have risen 44%, outperforming the Ftse-100 index by 30%, were little changed in the latest session.
Analyst at Liberum, who have a buy rating on the shares, said sales for the rest of the year would come up against tougher comparisons.
“Today’s performance nonetheless speaks to the strength of the group’s proposition, and to management’s ability to execute a successful total retail strategy that sees its store estate supporting growth in the online business,” they said.
Mr Wolfson, a prominent Brexit supporter and Conservative peer in the upper house of Britain’s parliament, said political uncertainty over Brexit was not stopping consumers spending.
“It’s a relatively low ticket price sector; we can see no evidence that the political situation is affecting peoples’ economic behaviour,” he said.
“Consumers tend to respond to reality rather than perception,” he said.
Next is one of the few UK retailers which has seen continued sales growth, offering a bright spot in an often bleak British retail sector.
However, the company warned that the outperformance can’t be extrapolated for the full year.
- Reuters. Additional reporting Bloomberg.