Next targets nearly £1bn in profits this year 

The company posted a 5% increase in profits during its last financial year. 

British retailer Next has said it expects profits to grow to nearly £1bn (€1.16bn) as it saw a surge in demand for its products during its latest financial year.

In the year to the end of January, Next generated profit before tax of $918m (€1bn) which is up 5% compared to last year. Next’s full price sales grew by 4% while total group sales - including subsidiaries - grew by 6%.

Next noted that selling price inflation in its own products has reversed mainly due to decreasing factory gate prices.

The British fashion and homewares retailer, whose performance is a closely watched indicator of consumer demand, stuck with guidance it gave in January that it will generate £960m (€1.12bn) of profit in 2024/25.

The company said that its outlook for this financial year has changed little since its trading update. 

“It has been a long time since we started a year in a more positive frame of mind,” said Chief Executive Officer Simon Wolfson, adding that the consumer environment is more benign than it has been for a number of years.

Chairman of the company Michael Rooney said the company has focused on “improving our product ranges, improving our online service levels, managing costs and profitability, whilst also laying the foundations for future growth businesses”.

“We also made a number of new investments, increasing our equity stake in Reiss by 21% to 72% and taking a 97% equity stake in FatFace. We also acquired 100% of the intellectual property in Cath Kidston,” he said.

The company announced that $288m (€336m) will be put towards share buybacks this year with £258m (€301.8m) being returned to shareholders by way of a dividend.

Additional reporting Bloomberg