Next maintains year guidance as Q3 sales fall

Next, which runs over 500 stores in Britain and Ireland, said today sales at shops open at least a year fell 3.3 per cent in the third quarter to October 30.

That compares with a second-quarter decline of 2.2 per cent.

Sales at the retailer's directory home shopping business grew 7.9 per cent.

That compares with analyst forecasts of a rise of 5-8 per cent and a second quarter increase of 11.8 per cent.

Next said it was sticking with its forecast for underlying retail sales to fall by 1.5-4.5 per cent in its second half to end-Jan. 2011, with directory sales up 4-8 per cent.

It also maintained it forecast for full-year pretax profit to rise 6-11 per cent to 535m-560m, with earnings per share of 214-224 pence, a rise of 14-19 per cent.

Next added that as a result of further rises in the price of cotton, retail price rises are likely to be at the top end of its previously stated 5-8 per cent range for the first quarter of next year.

Shares in Next have increased by a quarter over the last year, outperforming a 7 per cent rise in the UK general retailers index.

The stock closed last night at 2,239 pence, valuing the business at 4.1bn.