UK: Next sees improved trading conditions

British clothing retailer Next said trading had improved in the last eight weeks and that while the outlook remains uncertain it still expects full-year profits to be in line with market expectations.

Next, which trades from more than 460 shops in the UK and Ireland, said retail like-for-like sales fell 2.9 per cent in the 14 weeks to November 3rd, an improvement on the 4.8 per cent fall of the first six weeks.

"The last eight weeks sales have shown a significant improvement on the first six weeks," the company said in a trading update.

"However, trading patterns remain extremely volatile with good sales in September giving way to a disappointing October."

The company said although the outlook was uncertain, it was keeping its guidance for retail like-for-like sales to show a fall within a range of down 1 per cent to down 3.5 per cent for the second half of its financial year.

Sales at the Directory catalogue business rose 1.2 per cent in the 14-week period, having dropped 2.9 per cent in the first six weeks. Directory had been expected to show a fall of about 0.8 per cent, within a range of down 0.5 per cent to down 1 per cent.

Next now expects Directory sales in the second half to be flat to up 2 per cent, compared with its previous guidance of down 2 per cent to up 2 per cent.

Shares in Next, which have outperformed the UK general retailers' index by around 29 per cent so far this year, ended at £20.52 yesterday, valuing the company at around £4.3 billion.