(ShareCast News) - Clothing retailer Next has raised its sales and profit guidance for the year as warmer weather at the end of the season boosted second-quarter sales.It said Next brand full price sales for the 26 weeks to 25 July were up 3.5%, 1.7% of which came from the opening of profitable new space.Full prices sales for Next Retail were up 0.8% and Next Directory was up 7.5%. Total sales including markdown sales were 3.3% higher.The company said sales were better than expected and marginally ahead of the 0% to 3% growth guidance range it gave in March.Next raised its full-year pre-tax profit guidance to between £805m and £845m from a previous range of between £785m and £835m and lifted its sales guidance range to growth of between 3.5% and 6% up from a previous forecast of between 1.5% and 5.5%.It said the increase was the result of the better sales achieved in the first half of the year, adding that the mid-point of its profit guidance is very close to the current market consensus.The retailer said it intends to pay a further special dividend of 60p per share on 2 November.Richard Hunter, head of equities at Hargreaves Lansdown said: "Next continues its inexorable growth, raising its guidance for sales and profits along the way.""Traditionally the company tends to manage expectations lower and subsequently outperform. This has again been the case in the first half, helped along by some warmer weather," he added.Investec, which rates the stock at 'hold', said: "Next's full-price trading stance means it was more than able to offset a weak May, and we believe this will once again result in a better gross margin out-turn relative to clothing peers."It added that improvements in trading within Directory should reassure that the company can continue to deliver in existing and growth channels. It said Next was a "core holding" and the valuation reflects consistency of delivery, a higher margin structure and the ability to return surplus cash.At 13:20, Next shares were up 2.3% at 7,670p.
Next (NXT)