The group - seen as a retail bellwether - posted a 5 per cent rise in underlying pre-tax profits to £821.3m for the year to the end of January, having already warned over results in January after a difficult Christmas due to unusually warm weather.
Next said it was bracing itself for a slowdown in the global economy and for profits to fall by up to 4.5 per cent in a year that "may well be the toughest we have faced since 2008".
Next said that, as well as the wider economic woes, it also fears consumers are shifting spending away from clothing towards other areas, such as eating out and travel.
It is forecasting profits for the year to the end of January 2017 of between £784m and £858m - ranging from a fall of 4.5 per cent to growth of 4.5 per cent.
The group's predictions for full-price Next brand sales - a key measure of the company's performance - range from a fall of 1 per cent to growth of 4 per cent.
Next said it was preparing for a worst-case scenario, which could be skewed by weather conditions, but said "at this stage we think it is best to prepare ourselves for what could be a difficult year".
Lord Wolfson, chief executive of Next, said: "It looks as though we may be set for a challenging year, with economic and cyclical factors potentially working against us."
The group's gloomy comments will spark concerns for UK growth, which has been propped up by consumer spending and a thriving services sector in recent years.
Its warning also comes despite what the group described as a "solid" year, with Next Brand sales up by 3.7 per cent.
Sales across its 540 stores rose 1.1 per cent as growth was held back by a disappointing Christmas performance, when sales dropped 0.5 per cent.
It posted growth of 7.7 per cent across its Next Directory online and catalogue arm, but this marked a sharp slowdown on the 12.1 per cent surge seen the previous year as the festive trading woes were compounded by stock shortages and tougher online competition.