Next plc forecasts its annual pre-tax profit to slide to £370 million this year
- Next plc forecasts its annual pre-tax profit to slide to £370 million this year.
- The British multinational expects a 16% decline in annual full-price sales.
- The retailer partnered with Denise Lewis OBE for a range of activewear clothes.
Next plc (LON: NXT) raised its guidance for annual pre-tax profit on Tuesday, but warned that the figure will remain significantly weaker than last year. The company also said that trading during the Christmas period remained under pressure this year due to the ongoing Coronavirus pandemic that has so far infected more than 2.7 million people in the United Kingdom and caused over 75 thousand deaths.
Next plc was reported more than 5% up in premarket trading on Tuesday and jumped another 2.5% on market open. The stock is now trading at £73.46 per share. In comparison, it had a per-share price of a sharply lower £33.90. The price action should come in handy if you are interested in investing in the stock market.
Next’s sales to take a hit due to the renewed lockdown
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Next said that its profit is likely to print at £370 million this year versus a significantly higher £728 million last year. Earlier in October, the clothing company had forecast a lower £365 million of profit in the year to conclude in January 2021.
According to the retailer, trading remained upbeat in November and much of December, but it anticipates the benefit to be completely offset by the expected loss attributed to the upcoming store closures in January due to the newly announced nationwide lockdown to combat the Coronavirus pandemic.
In separate news from the United Kingdom, the fourth largest British supermarket chain, Morrisons said that its comparable sales in the 22 weeks to 3rd January jumped 8.1% amidst the news COVID-19 restrictions.
Full-price sales this year, as per Next plc, are likely to post a 16% annualised decline. For fiscal 2022, the British multinational forecasts £670 million of pre-tax profit if full-price sales remain flat compared to the financial year to conclude in January 2020.
Next says COVID-19 disrupted container traffic this year
Next also highlighted on Tuesday that the ongoing pandemic had also disrupted container traffic leading to a two-to-three-week delay in current deliveries. Such disruptions, the retailer said, were likely to continue in 2021.
The Leicester-based company partnered with Olympic gold medallist Denise Lewis OBE in December for a range of activewear clothes.
Next plc remained almost flat on average in the stock market last year. At the time of writing, it is valued at £9.76 billion and has a price to earnings ratio of 28.52.