Next has reported third quarter sales at the upper end of its guidance range but warned that clothing price rises will also be at the top end of expectations.
Next increased turnover by 2.2% in the period to October 30. Sales at the retail division fell by 0.3% and like-for-like sales fell by 3.3%, while Directory was ahead 7.9%. Next had forecasted total group sales rise of up to 3% and a retail like-for-like decline of between 1.5% and 4.5%.
Next said: “As a result of further rises in the price of cotton, retail price rises are likely to be at the top end of our previously stated 5% to 8% range for the first quarter of next year”.
“The longevity of what appears to be a speculative bubble in cotton prices will be critical in determining prices for the second quarter.”
The retailer said it faced tougher comparatives in the fourth quarter than in the third but full year profits would come in, as previously indicated, at between £535m and £560m.