Shares in Next jumped as the retailer upgraded its annual profits forecast following a sales boost from the recent heatwave.
The group said that unusually warm weather in recent weeks, which resulted in a ‘sales over-performance’, will add around £12m to its full year profit.
In a first quarter trading update, Next saw full price sales rise six per cent in the 14 weeks to May 7, with online revenue growing 18 per cent.
Shares rocketed over six per cent following the update.
“Sales in the first quarter were better than we expected and around £40m ahead of our internal forecast, boosted in recent weeks by unusually warm weather.
“This sales over-performance adds around £12m to our full year profit and we are therefore increasing our central guidance for group profit accordingly.”
It means that Next is pencilling in full year profits of £717m, up 2.2 per cent from £705m.
However, the figures also show that sales at its high street stores were down 4.8 per cent, reflecting the wider malaise in the retail sector.
Richard Lim, chief executive of Retail Economics, said while the results are better than expected, they should be put in the context of a “soft benchmark” from the previous year. “The story of continuous structural challenges underlies the narrative for these results. In-store sales continued to spiral downwards indicating the relentless shift towards online shopping.
“This reflects the real challenge for many high street retailers who are oversupplied with physical space while consumers increasingly spend both their time and money away from traditional high streets.”
The retail sector has been hammered by rising costs and falling consumer confidence, which has contributed to hundreds of store closures this year.