* Sales in nine weeks to Dec 26 fall 1.1%
* Company had forecast a drop of 8%
* More than 50% of store sales in Nov lockdown went online
* Shares rise to five-year high
(Adds CEO comments, shares)
By Paul Sandle
LONDON, Jan 5 (Reuters) - British fashion retailer Next
soundly beat its forecast for Christmas sales despite
COVID-19 lockdowns hitting store sales in November and the final
shopping days of December, resulting in another upgrade to
underlying profit guidance.
Shares in the company rose as much as 9% to a five-year high
of 75.22 pounds in early Tuesday trade.
Next, which has seen increased demand for children's clothes
and leisure wear during the pandemic, said full-price sales fell
1.1% in the nine weeks to Dec. 26 on last year, beating its
central guidance of an 8% drop given in October.
Chief Executive Simon Wolfson said its online operations had
coped with a spike in demand as more than half of the sales that
would have been made in store in November migrated online.
"We were surprised that the business did as well as it did
despite the November lockdown," he said in an interview. "Our
operations kept up with demand, which was something we were
anxious about in October."
Next, the first major UK listed non-food retailer to update
on Christmas trading, nudged up its underlying pretax profit
guidance for the year to the end of January to 370 million
pounds ($502 million), its fourth upgrade in five months.
However, two one-offs - a 40 million pound provision on the
value of store leases and a 12 million pound boost from an
additional week of trading - would result in new unadjusted
guidance of 342 million pounds, it said.
It anticipated a 14% loss of full-price retail sales in
January as a result of a third national lockdown in England.
The business said it would also incur costs clearing more of its
retail end-of-season sale stock online.
For its 2021/22 financial year, its central scenario which
sees disruption in the first half and a recovery in the second,
is for sales on a par with its 2019/20 year, and pretax profit
of 670 million pounds.
($1 = 0.7358 pounds)
(Reporting by Paul Sandle; Editing by Kate Holton and Mark
Potter)
Next (NXT)
