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UK fashion retailer Next has raised its profit forecast after consumers bought more clothes than expected and the group’s own cost pressures eased.
The company said on Thursday that profits for the full year would be £875mn, up from an earlier forecast of £845mn.
The modest revision follows an upgrade in June when Next said a combination of warmer weather and wage inflation had helped drive sales.
Lord Simon Wolfson, the Conservative peer and longest-serving FTSE 100 chief executive, said: “We were overly cautious about the prospects for sales in the current year, we underestimated the support nominal wage increases, and a robust employment market, would give to our top line.”
UK wages climbed at the fastest pace on record in the three months to July.
Full-price sales in the first half of the year rose 3.2 per cent, surpassing the group’s own forecast of a 3 per cent decline. The company said pre-tax profits for the six months to July climbed 5 per cent to £420mn.
Shares in Next have climbed 20 per cent so far this year, outpacing a 2 per cent increase in the FTSE 100.