Next PLC Trading Statement (9642M)
August 03 2017 - 1:01AM
UK Regulatory
TIDMNXT
RNS Number : 9642M
Next PLC
03 August 2017
Date: Embargoed until 07.00hrs, Thursday 3 August
2017
Contacts: Lord Wolfson, Chief Executive
Amanda James, Finance Director (analyst
calls)
NEXT PLC Tel: 0333 777
8888
Alistair Mackinnon-Musson Email: next@rowbellpr.com
Rowbell PR Tel: 020 7717
5239
Photographs: http://press.next.co.uk/media/company-images/campaignimages.aspx
Next plc - Trading Statement - 3 August 2017
SALES FOR THE 26 WEEKS TO 29 JULY 2017
Full Price Sales Performance
Full price sales in the second quarter were up +0.7% on last
year. The table below sets out the sales performance by quarter for
Retail and Directory. Year to date full price sales are down -1.2%
just ahead of the mid-point of our full year guidance range given
in May. Directory had a particularly good second quarter with sales
up +11.4%, which was driven by strong sales in both the UK and
overseas.
Full Price Sales First Second Quarter Year to
(VAT exclusive) Quarter to 29 July Date
to 29
April
================== ========= =============== ========
Retail - 8.1% - 7.4% - 7.7%
Directory +3.3% +11.4% +7.4%
========= =============== ========
Brand Total - 3.0% +0.7% - 1.2%
Of which sales
from new space 1.6% 1.5% 1.5%
Total Sales Including Markdown Sales
We went into the end-of-season Sale in July with -5% less stock
and markdown sales are down -14%. This meant that statutory total
sales, including markdown sales, were down -2.1% in the quarter and
down -2.3% in the first half. The statutory total sales are
understated as a result of a delay in the timing of Directory
end-of-season Sale despatches. Adjusting for this distortion,
underlying total sales in the second quarter were down -1.6% and
down -2.0% in the first half.
TRADING PATTERNS & SALES OUTLOOK FOR THE REST OF THE
YEAR
Full Price Sales to Date
The bar graph below shows the year on year percentage full price
sales variance by month. During the second quarter June and July
sales have been better than expected. We believe there has been
some improvement in our product ranges and our online functionality
during this period. However, we believe most of the increase in
full price sales is due to the much warmer weather and, to a lesser
degree, lower markdown sales in the end-of-season Sale.
Click or paste the following link into your web browser to view
the bar graph titled '2017 Full Price Sales Variance by Month vs
2016'. Refer to page 2 for this chart
http://www.rns-pdf.londonstockexchange.com/rns/9642M_-2017-8-2.pdf
Outlook for Second Half Sales
In the current consumer environment we remain cautious and are
budgeting for second half full price sales to be down -1.2%, which
is in line with our performance in the first half.
PROFIT GUIDANCE FOR THE YEAR
We have narrowed our sales guidance range for the full year to
-3.0% to +0.5%. This is a small improvement to the mid-point of our
previous full price sales guidance. However, the improvement in
full price sales has been offset with lower clearance rates during
our end-of-season Sale and the assumption we will experience a
similar deterioration in our January Sale. This has resulted in our
central profit guidance remaining unchanged.
Full Year Estimate New Guidance Previous
Guidance
Year to January 2018 Lower Upper Lower Upper
============================== ======== ======== ======== ========
Total full price sales vs
2016/17 (inc currency gain) - 3.0% +0.5% - 3.5% +0.5%
Group profit before tax GBP680m GBP740m GBP680m GBP740m
Change in profit before tax
versus 2016/17 -13.9% - 6.4% - 13.9% - 6.4%
============================== ======== ======== ======== ========
We will update our guidance when we announce our first half
results on Thursday 14 September.
CASH FLOW, SPECIAL DIVIDENDS AND SHARE BUYBACKS
In our January 2017 trading statement we advised that we
intended to distribute surplus cash to shareholders by way of four
quarterly special dividends of 45p each. This is still our
intention, subject to our full year sales and profits falling
within our guidance range. To date we have paid two special
dividends of 45p per share on 2 May and 1 August 2017.
The Board has decided to declare a third special dividend of 45p
per share to be paid on 1 November 2017 to shareholders registered
at the close of business on 6 October 2017. Shares will trade
ex-dividend from 5 October 2017.
We now have greater visibility of our full year cash flow and at
the mid-point of our guidance range expect to generate GBP307m of
surplus cash (cash flow after deducting interest, tax, capital
expenditure and ordinary dividends) in the current year. After
making four quarterly special dividends, to the value of GBP257m,
we will be left with surplus cash of around GBP50m. It remains our
policy to distribute surplus cash to shareholders through special
dividends or share buybacks. In deciding between the two methods of
distribution the Board will take account of the longer term outlook
for the business, market conditions and the prevailing share
price.
Forward Looking Statements
Certain statements in this Trading Update are forward looking
statements. These statements may contain the words "anticipate",
"believe", "intend", "aim", "expects", "will", or words of similar
meaning. By their nature, forward looking statements involve risks,
uncertainties or assumptions that could cause actual results or
events to differ materially from those expressed or implied by
those statements. As such, undue reliance should not be placed on
forward looking statements. Except as required by applicable law or
regulation, NEXT plc disclaims any obligation or undertaking to
update these statements to reflect events occurring after the date
these statements were published.
LEI: 213800WQD8ECPZP9PH98
This information is provided by RNS
The company news service from the London Stock Exchange
END
TSTVLLFBDVFXBBK
(END) Dow Jones Newswires
August 03, 2017 02:01 ET (06:01 GMT)
Next (LSE:NXT)
Historical Stock Chart
From Apr 2024 to May 2024
Next (LSE:NXT)
Historical Stock Chart
From May 2023 to May 2024