Next’s boss has lowered profit expectations for this year and warned buyers that they will have to pay more for products in a “growing uncertain world”.
The fashion chain reports that the alarm bells ring that last year surpassed all expectations due to increased online sales and demand from shoppers to use their lockdown savings.
The FTSE 100 retailer, which raised guidelines for the fifth time in January, reported pre-tax profits of £ 823 million for the year to the end of January, 140 percent higher than the previous year and 10 percent better than the previous year. That was behind the 4.6 billion in statutory sales, which is 8.4 percent better than in 2019.
The latter was started by George Davis in 1982 and has about 500 stores employing 21,600 people. Its website sells hundreds of third party brands, including Jules and Tommy Hilfiger. Shares of Next fell 184p, or 2.88 percent, to £ 62.00 in morning trading, valued at কোম্প 8.2 billion.
Next said last year’s sales surge was in stark contrast to this year’s “unusually high levels of geopolitical and economic uncertainty.”
Lord Wolfson, 54, chief executive of Aspel Guis, said the company faced five major uncertainties, including the discomfort of epidemic savings, the return on travel and leisure costs, inflation of essential commodities and its own selling price and growth in the UK. Taxes. The business is also losing £ 18 million in profits as a result of the closure of its Ukrainian and Russian online businesses, although it expects better store sales in the UK.
As a result, Next cuts its central profit guidance by £ 10 million to £ 850 million, up 3.3 percent from this year. Its forecast ranges from £ 795 million to £ 895 million.
The volatile context has also prompted Next to lower its guidelines for full-price sales to কম 85 million, although it still expects them to grow 5 percent, boosting revenue from its credit offer due to consumer finance pressures.
Next said inflationary pressures meant it would send buyers more of its spending and that prices were expected to rise 8 percent, up from a 6 percent guidance in January.
Retailers say prices will rise 3.7 percent in the first half of the year, but inflation will double in the second half, splitting fashion into a 6.5 percent increase and a 13 percent increase in household goods.
In a generally detailed analysis of inflationary pressures, the business said it expects total spending growth of £ 143 million this year, including £ 20 million from additional energy costs, £ 55 million from wage inflation and ভ 6 million from employee travel resumes. In the meantime, it will save £ 79 million on lower internal costs, rising costs to cover shipping costs, and lower staff incentives.
Wolfson said: “It is important to understand that the cost of living is a supply-like crisis: the inflation we are experiencing is a symptom of an inherent constraint on the supply of goods.”
A day after the Chancellor’s spring statement, Wolfson said the government could “ensure and ensure that those most in need can carry basic necessities through targeted subsidies and grants. Second, they can take steps to increase the supply of goods, property and services that There is so little supply. “
Wolfson, who has been a vocal advocate for more investment in housing, said: “We appreciate the Chancellor’s efforts to help those most in need, but we are disappointed that the larger government has done little or nothing to increase its power. Underlying supply of skilled workers It is important to recognize that government interventions to increase inflation do nothing to increase the underlying supply of goods and services.