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Sales slip at Next

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Total sales for the three months to 29 July fell 2.1% at Next compared to last year, despite warmer weather and an improvement in full-price sales at the retailer.

Full price sales in the second quarter edged up 0.7% on 2016. In store sales fell 7.4%, while online and directory sales were up 11.4% on last year, driven by “strong sales” in the UK and overseas.

For the 26 weeks to 29 July, full price sales were down 1.2%, while total sales for the period dropped 2.3% on 2016.

The business went into its end of season Sale in July with 5% less stock than last year. Markdown sales were down 14%.

It said sales in June and July were “better than expected”. It credited this with “some improvement” in product ranges and online functionality, but added the increase in full price sales was fuelled by the “much warmer weather” and to a lesser degree, lower markdowns in the summer Sale.

Next said it remained “cautious” in the current consumer environment and is budgeting for second half full price sales to be down 1.2%, in line with its performance in the first half.

The retailer has narrowed its sales guidance range for the full year to between -3% and +0.5%, this compares to the previous guidance of -3.5% to +0.5%.

However, Next said the improvement in full price sales for this period was offset by lower clearance rates during its summer Sale and it expects a similar deterioration in its January Sale. Therefore profit guidance remains unchanged at £680m to £740m for the full year.

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