Next PLC Cuts Prices After Surprising Profit Surge
Bottom‑Line Boost
- Underlying pre‑tax profit up 5% to £918 million for the year ended January.
- Beat the £905 million forecast thanks to a better‑than‑expected stock clearance.
- Full‑price sales grew 4.0%, flipping the budgeted 1.5% dip.
- Projected group sales for FY24: +6.0%, with full‑price sales up +2.5%.
Why the Price Drop?
Next says it’s tweaking prices as the market slacks a bit—think weaker job prospects and mortgages hitting the end of their cycle. Amanda James, on PA news, called it a “budget‑friendly” move for customers.
Strategic Timing & Costs
“Our teams have played the clock to smooth out the cash flow,” the group noted. They’re also flagging higher freight costs as a factor that’s being priced in, but they still expect price declines over time.
Consumer Confidence
Russell Pointon, director of consumer at Edison Group, praised Next’s resilience: “Their FY23 results show a 5.9% rise in sales and a 5.0% jump in pre‑tax profit, beating last year’s guidance by £3 million.”
Future Guidance
- Post‑tax EPS forecast: 606.3 p, a 4.8% lift.
- Running the numbers, Next is “optimistic on its prospects” and remains a key player in retail.
So, while the price tag might come down, the confidence in Next’s brand stays high—customers get quality on a budget, and the company keeps margins healthy. Take your cue: shop smart, shop Next.
