Next, the UK clothing retail giant, is set to announce its annual trading figures on April 1st. Despite the challenges posed by store closures during lockdown, analysts are optimistic about the company’s prospects. Next has consistently upgraded its profit forecasts over the past year, largely thanks to robust online sales.

The Royal Bank of Canada analysts have noted Next’s strong online and credit offerings, positioning the company to benefit from disruption in the UK mid-market. With its advantages in logistics, range, and customer loyalty, Next is well-positioned for success. The bank has even upgraded its investment stance on Next from ‘sector perform’ to ‘outperform.’ It has also raised its profit forecasts for FY22-23 by 5%-9% above consensus.

Industry analysts are eagerly anticipating updates on Next’s ‘Total Platform’ offer, which includes third-party brands and recent acquisitions like Reiss and Victoria’s Secret (UK). These expansions are part of Next’s strategy to drive its recovery and diversify its portfolio.

In terms of financial performance, Next is expected to report pre-tax profits of around £342 million for the year to January, a significant drop from the previous year’s £728 million profit. However, these figures represent an improvement from earlier projections when CEO Simon Wolfson warned of the potential for zero profit. In January, Wolfson revised the sales forecast for 2021-22, predicting flat sales and a pre-tax profit of approximately £670 million. This revision came after Next reported better-than-expected sales during the Christmas period, with revenues experiencing only a marginal 1.1% decline over the nine weeks leading up to December 26th.

Overall, analysts maintain a positive outlook for Next’s future performance, emphasizing its strong online presence, credit offering, and strategic expansions as key drivers of success. As lockdown measures continue to ease, Next is expected to make a strong recovery in the new financial year. As a long-standing indicator of the UK clothing retail industry, Next’s trading figures will undoubtedly attract significant attention and provide valuable insights into the sector’s overall health.

Useful Links:
1. Next Official Website
2. BBC article on Next’s annual trading figures