Next plc says its quarterly sales dipped much less than expected
- Next plc says its quarterly sales dipped 1.5% versus 10% expected.
- The retailer lifts its guidance for full-year pre-tax profit to £740 million.
- Next plc shares jumped more than 1% on market open on Thursday.
Next plc (LON: NXT) said on Thursday its performance showed resilience in the recent quarter that gave it the confidence to lift its guidance for the full year once again.
Next plc shares opened at £82.06 in the stock market on Thursday and are currently trading at a per-share price of £83.12. In comparison, the Leicester-based firm had started the year 2021 at a much lower £69.12 per share. Here’s what you need to know about why do prices rise and fall in the stock market.
Next plc now forecasts £740 million of pre-tax profit this year
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Full-price sales, as per Next plc, tanked 1.5% in the thirteen weeks that concluded on May 1st versus the same period in 2019. In its earlier guidance, the retailer had expected a sharply broader 10% decline instead.
Next plc now forecasts its pre-tax profit to print at roughly £740 million this year versus £720 million it had expected earlier. The British multinational expressed confidence that its digital sales are likely to see a 24% growth in 2021 compared to two years ago. While retail sales will remain 20% down versus 2019, overall full-year sales will still jump by 3%.
In the recent thirteen weeks, the clothing company posted a 65% increase in total online sales as the COVID-19 restrictions continued to fuel eCommerce. Retail sales in the United Kingdom and Ireland tanked 76% during the period as stores remained closed for the public in the first ten weeks.
In separate news from the United Kingdom, Superdry said it returned to revenue growth in the fourth quarter.
UBS raised its price target on Next plc to 8,300 pence
Compared to 2019, sales growth in the last three weeks stood at 19%. Following the quarterly results, UBS announced a price target of 8,300 pence on Next plc, up from its previous 8,200 pence price target. Peel Hunt analysts also commented on the financial update and said:
“We feel there is a significant rebase to normality as lockdown restrictions ease. Next remains one of the most relevant UK platforms, fully geared into consumer recovery”.
Earlier this month, Next plc said its full-year profit before tax tanked to £342 million. Next plc performed only slightly upbeat in the stock market last year with an annual gain of about 2.5%. At the time of writing, it is valued at £11.06 billion and has a price to earnings ratio of 37.48.