UK based clothing retailer Next are close to an all-time high, thanks to a strategy that has seen the company sail through Covid-19 headwinds.
With the start of the first lockdown last March, Next feared shuttering its high street stores would have a disastrous impact on finances.
UK based clothing retailer Next sales growth have held up better than expected, boosted by higher demand for home furnishings, loungewear and children’s clothing. Though back in last March, the fashion brand dreaded closing its high street shops which will have a terrible effect on finances.
Besides, The Next share price rose as high as £79.34 recently, close to the record of £80.15 reached in December and August 2015. The shares have more than doubled since they fell to a low of £36.62 in March, and have gained nearly 15% over the past year.
Next has appeared as one of the victors from a rough Christmas period thanks to robust online sales. In the 9 weeks to 26 December, sales were 1.1% lower than the previous year, a much better act than the 8% decline the company had forecasted in the autumn season. Along with 43% of its physical stores closed. Though Next’s online sales were up by 36%.
Simon Wolfson, Chief Executive Officer, Next said, “The £28m of extra profit from better-than-expected sales in November and December will be all but wiped out by the impact of shutdowns during the Boxing Day sales as well as new lockdowns in England and Scotland in the new year that have forced non-essential retailers to close again, including Next’s 500-store chain.”
Amid all this uncertainty, Next is forecasting profits of £670m for the coming year. The amount would be within 10% of pre-COVID-19-pandemic levels.
Neil Wilson, Chief Market Analyst said Next, together with web-only retailers such as Asos, have obviously appeared as “online champions”, noticing that short sellers have “thrown in the towel in the last couple of months which has been helping drive the stock higher.”