Next has reported a rise in sales over summer and has raised its annual profit expectations.
The group reported a 0.5 percent rise in first-half profits to £311 million in the 26 weeks to 28 July, however, still remains cautious amid the difficult trading conditions.
“The UK retail market remains volatile, subject to powerful structural and cyclical changes. Many of these headwinds have not abated. As expected, sales in our stores (which now account for just under half of our turnover) continue to be challenging,” said the retailer.
“We believe the over-performance in the first half was flattered by the unusually warm summer and we remain cautious in our outlook for the rest of the year.”
Although Next has warned about the effects of port delays in the event of a no-deal Brexit, the group’s boss Lord Wolfson has said that a no-deal Brexit will not be a “material threat”.
“It is not yet clear how well prepared HMRC systems, customs and other relevant personnel will be for the upcoming potential increase in workload and data capture,” he said.
“We believe that the biggest risk to our business is the external risk of UK ports not coping with the additional volume of customs work they would be required to undertake if no changes are made to the UK’s current procedures… We believe that it remains open to the government to initiate changes in the way customs procedures operate and that such measures could eliminate much of the risk to our ports.”
“There are significant challenges involved in preparing for a no-deal outcome and we would not want to understate the work we are doing to prepare for this eventuality. However, we do not believe that the direct risks of a no-deal Brexit pose a material threat to the ongoing operations and profitability of NEXT’s business here in the UK or to our £190m turnover business in the EU,” he added.
Shares in the group (LON: NXT) jumped over nine percent on the opening of the market.