Next share price jumps 10pc after sales guidance upgrade

Retail giant Next (LON:NXT) saw shares rise over 10 percent in morning trading on Thursday, after a pick-up in performance over the last three months.

The retailer, who have continually struggled to keep up with competition in the retail sector, saw sales drop a further 2.2 per cent to £1.9 billion during the six months to 31 July. This was an improvement on the 8.3 percent drop seen in the same period in 2016, with the Next directory increasing sales by 5.7 percent to £868.4 million. However, the group’s pre-tax profit also dropped 9.5 per cent to £309.4 million.

A spokesman said: “The first half of the year has been difficult and sales and profits are in line with our cautious expectations.

“However, our performance in the last three months has been encouraging on a number of fronts and whilst the retail environment remains tough, our prospects going forward appear somewhat less challenging than they did six months ago.

“As a result, we are taking the opportunity to modestly upgrade our sales and profit guidance for the full year.”

The group’s revised guidance now ranges from a 2.0 per cent fall in sales to a 1.5 per cent increase, having previously warned sales could fall by as much as 3.0 per cent.

The upgrade to profit and sales guidance was well-received by analysts, however, with shares currently trading up 9.42 percent at 4,839.00 (1129GMT).