Next to outline recovery plan
Fashion chain Next is to invest £17 million over the next three years to revive its existing stores and product offering. Another £10 million will be spent on marketing this year, in an effort to win back customers. The UK 's second largest clothing chain revealed plans for recovery while releasing its results for 2007. Group pre-tax profit rose 6.5 percent to £478 million on revenues up 5.7 percent to £3.3 billion. Despite solid revenues and profit gains, like-for-like retail sales were disappointing, down by 7.2 percent.
The fashion giant holds 6.6 percent of the British apparel market, but has seen sales wane. The company intends to improve its product offering by increasing its focus on newness, quality and desirability. The group emphasised that it needed a more emotional response to its product, rather than regarding it merely as a commodity. Next released a statement communicating what the brand stands for: “Exciting, beautifully designed, excellent quality clothing and home ware; presented in collections that reflect the aspirations and means of our customers.” It also plans to upgrade its marketing efforts, including in-store marketing from graphics through to internal displays. The group said it had spent over £2 million alone on replacing shop window mannequins.
Chief executive Simon Wolfson warned that the consumer environment would remain “challenging”. “While we are still cautious for the year ahead we do expect to make progress in stabilising Next Retail like-for-like sales,” he said, concluding, “Next remains highly cash generative and we will continue with our policy of buying back shares when it is earnings enhancing and in the interests of shareholders generally.”
22 March 2007
Next launch online catwalk show
Next this week launched an online fashion show featuring supermodel Yasmin le Bon on its catwalk. Le Bon, who modelled in the first-ever Next Directory in Spring 1988 has been a regular face for the retailer, bringing her special blend of glamour and sophistication. Key looks and must-haves for Spring include, trapeze, tulip, mini, monochrome, platform and patent, and is very 60's inspired.
Dress like the jet set with Next's Dolce Vita collection, featuring a smart?swing coat, bold monochrome, a fitted pencil skirt suit?and of course the luxury sunglasses. For summer the Havana collection features simple but sexy shift dresses, pencil skirts and platform heels. Clashing golden yellow or burnt orange accessories to finish the look. See the show online and order the catwalk looks at www.next.co.uk .
24 January 2007
Next optimistic despite dip
High street fashion retailer Next appeared optimistic about its outlook despite a 6.9 percent fall in like-for-like sales during the six months ended 31 December. Total sales for the period rose 2.8 percent. The company raised its annual profit outlook to between £463 million and £473 million. Analysts had previously expected annual profits to be £456 million.
The company's catalogue business, Next Directory, performed particularly well, as expected, and outperformed Next's 308 stores. Sales rose 9.3 percent during the period, thanks to better stock control, which it said allowed it to maintain its margins. Next added that operating profits were expected to increase by between 5.1 percent and 7.2 percent. Based on this, earnings per share, which the company said had been improved by its share buyback policy, would increase by between 11.0 percent and 13.4 percent.
Next will release its preliminary results for the years ended 27 February on 22 March.
4 January 2007
Next catalogue sales exceed expectations
British clothing giant Next reported on Wednesday that first half pre-tax profits had risen 3.6 percent to £178.9 million on revenues up 8 percent to £1.51 billion, in line with the top end of expectations. The clothing catalogue Next Directory exceeded expectations, with operating margin gaining 16.6 percent. “The internet has become a significant part of Next Directory's business and we now take 45 percent of its sales online,” said the group. Sales at Next Directory rose 15.3 percent, while profits were up 44.7 percent. The business now represents over a third of total sales, but generates more than half the profit made in retail stores. The group expects Next Directory sales to gain between 7 and 9 percent in the second half.
Strong demand for the online business compensated for a less stellar performance on the high street, with no indication of a significant recovery in the coming months. Like-for-like sales dropped 7.5 percent for the first half, as had been expected, and although recent sales have improved, the company advised against reading too much into such a short period. “Sales remain volatile and have been positively affected by the cooler weather,” the company said. It blamed poor like-for-like sales on weak full price comparable sales in the first half, which were intensified by a poor first week of its sale. “The sale was at the same time as last year, which in the current retail environment may have been too late, and initial markdowns may not have been aggressive enough,” the company said, adding that it would review the timing of the Summer Sale next year as well as the level of markdowns. It has also reduced the amount of in store products for Autumn/Winter 2006/7 by more than 10 percent to improve store layout and presentation.
The retailer has had to deal with increased competition from the likes of Marks and Spencer and Primark and lower consumer spending levels due to higher living costs. On a more positive note, the group's new brand Lime, which was introduced in clearance stores earlier in the year, has “started better than originally anticipated”. “We will be opening several trial stand-alone stores in the second half to gauge whether Lime could operate as an independent brand.” As the locations are existing Next shops that are due to be vacated as part of the group's expansion programme. A spokeswoman said that the first Lime stores will be opened this week in Derby and Newbury. Later in the month a shop will open in Doncaster . If the venture proves successful, new locations might follow, she said.
14 September 2006
Next opens standalone for lower-priced brand
Next is planning to open a standalone store for Lime, its new low-price clothing line, later this year. The move represents a departure for the retailer, which has to date resisted launching sub-brands in order to focus on its core Next product lines. The development has caused speculation in property circles that Next is plotting to roll out a value chain to rival retailers such as Primark and Peacocks.
Next confirmed that it is considering opening a stand-alone Lime store, but added that it has no plans for a chain. The company said that the outlet is being converted to Lime because the store is too small to accommodate a full Next shop. "It is more tactical at this stage," Next said, adding that it could be a one-off. However rival retailers believe that Next could be gearing up for an assault on the value sector."It looks like they are testing the market," said the chief executive of a rival chain.
9 July 2006
Next boss departs
David Jones, the Next chairman who ran the company for four years after serving as chief executive for 12 years, stepped down at the company's agm last month. John Barton is to be the new chairman of the retailing group.
Jones' departure coincides with declining turnover at the group, with chief executive Simon Wolfson reporting like-for-like sales down 5.8 per cent from 29 January to 13 May at 244 stores not affected by new openings, and the likelihood of “a confirmed slowdown”. Next Directory sales rose by 13.2 per cent over the same period.
14 June 2006
Next to enter TV shopping market
Television shopping is estimated to be a market worth £950 million and high street retailer Next is hoping to extend its Directory market by appearing on tv shopping channels. Next has been in talks with Ideal Shopping Direct to be featured on air with programming to be shown channels such as Sky, Freeview and NTL .
Verdict senior retail analyst Maureen Hinton stated that Next's decision was astute, given that 70 per cent of British homes now have some form of digital TV. She further said: “Next is looking at all sales avenues and this is just another one. Its customers use and are comfortable with technology when placing Directory orders online – this is another branch of that trend.” Home shopping has gained in notoriety in the last two years and there is a growing trend for buying fashion from television broadcasting. Experts are prediction other major fashion multiples will soon follow suit.
10 April 2006
Next predicts bleak future
High street retailer Next has said that tough trading conditions persisted as like-for-like sales continued to decline. The British chain said that it would add new shopping space and improve margins of its mail order business, Next Directory, while controlling costs and maintaining margins. Like-for-like sales were unaffected by new store openings in the eighteen weeks ended 18 March. However, the group warned that the same period last year included Mother's Day and pre-Easter shopping.
Although the group had warned that last year would be a difficult year, it still managed to achieve a rise in pre-tax profits of 5.8 percent to £449.1 million for the year on revenues of £3.1 billion, up 8.7 percent from the previous year. Chief executive Simon Wolfson said that the group had reduced average prices by 5 percent but had maintained margins by improving labour efficiency, reducing premium pay and improving logistics.
27 March 2006
Fashion at Next
Fashion at Next seems to get better and better. For Spring / Summer 2006 the high street favourite has some delectable cropped jackets on offer (remember it was Chloe's must-have piece on the runway this season). Textured jackets are softly tailored with three quarter-length sleeves and come in lime green and black. Pair them with your favourite skinny jeans and flats (no pointy shoes this season, ladies) for Spring's freshest look.2 March 2006
Conservative party appoints Next clothing boss
The chief executive of the Next clothing chain and one of the City's youngest bosses has been appointed by David Cameron to advise him on how to improve economic competitiveness and wealth creation in the UK. Simon Wolfson is the son of Lord Wolfson, former chief of staff to Margaret Thatcher.
His appointment as joint head of the Conservative party's official advisory group on economics will be announced tomorrow. Working with the anti-red tape Tory MP John Redwood, he will jointly chair the advisory group that will seek to reduce regulation and improve educational standards, skills in the workplace and competitiveness. It will also examine Britain's transport infrastructure.
Next assuages high street fears
UK fashion retailer Next has reported it expects full year profits before tax to exceed market expectations. The chain said profit would be “in the range of £435 million to £450 million”. On Wednesday the company said that like-for-like sales unaffected by openings in the period 1 August to 24 December were down 3.2 percent, but warned that the first half of 2006 would see like-for-like sales remain at their current level. Meanwhile, sales were up 8.7 percent. Combined sales of Next Retail and Next Directory rose 9.8 percent, while Next Directory sales increased 13.7 percent.
“We remain cautious for the first half of the new year. Whilst we expect to grow sales from the addition of new space we are budgeting for like-for-like sales to continue to run at about 3 percent over the next six months,” said the clothier. "We saw an increase in winter clothing sales with a change in the weather before Christmas, but I think it would be a mistake to characterise that as a revival in the consumer economy," Chief Executive Simon Wolfson told Reuters.
Although analysts were pleased with the profit news, analyst John Stevenson of Shore Capital told the FT: “By our calculations, which take into account the effects of new openings, these like-for-like figures are broadly unchanged since September. While we welcome the news on profits and are upgrading our figures, there is an element of caution.”
Furthermore, he called the outlook “a bit staid” and commented on the trading environment still being tough. Next's performance is generally perceived as a reliable indicator for the retail sector, and analysts have followed the retailer closely.
Since it announced its worst trading results in seven years in September, analysts have been waiting for Next to improve its performance. In the meantime they had predicted underlying sales would be down 3 to 5 percent over Christmas.
Next will post its full year results on 23 March.
4 January 2006
Next expected to show sales growth
British fashion retailer Next Plc is expected to announce an increase in sales when it reports its results on Wednesday, reports The Daily Telegraph, based on findings by retail consultancy Verdict. The paper expects like-for-like sales growth down by 3.0-5.0 percent, up from a 6.0 percent drop in September. In that month the retailer said it had suffered the worst trading conditions in ten years.
The industry will be following the release of the figures closely, looking for a sign that the market is improving. According to The Daily Telegraph, figures to be released by John Lewis on Friday will be a truer indication of market improvements. Meanwhile, Next has lost business to Marks & Spencer, which experienced a sales recovery recently. “Both companies share too many customers,” said Richard Hyman, managing director of Verdict. “I do not believe both have had a very good Christmas period. M&S has been performing well, though this is from a low base last year.”
3 January 2006
Deputy Chairman of Next retires
David Jones, deputy chairman of Next, has announced his retirement after 20 years with the retail chain. He does not, however, have any intention of stepping down as deputy chairman of supermarket group Wm Morrison. He told the FT that his decision to retire from Next has nothing to do with his fight with Parkinson's disease, which he has been suffering from for the past 23 years. John Barton, the current deputy chairman, will replace him.
“It is fair to say my illness is getting more difficult to handle but that is not why I have made my decision to step down,” he said. “I am feeling totally relaxed about it because life has moved on. I am a great believer that no one should run anything for more than 10 years, you should know when to go.” Jones was chief executive of Next for 13 years before becoming deputy chairman in 2001. The current chief executive, Simon Wolfson, said Jones would be missed, but “typically of him, he has planned his own succession immaculately.”
20 October 2005
Next buys too much stock
It seems that British fashion retailer Next has overestimated its rate of sales growth and has bought too much stock for this season. This could result in a £34 million hit to sales this Christmas, according to analysts at investment bank JP Morgan.
“This is only an estimate, and it could be higher, though I don't think lower. It follows straight through to the bottom line,” Chiara Terzaghi of JP Morgen told the Independent on Sunday. The calculation was made after a detailed study of Next's muted update last month during which the company said that weak trading would not cease.
As a result, there has been market gossip that the group could release a profit warning during the coming weeks. Some banks have now downgraded the stock. According to the Independent on Sunday, Next is regarded as good indicator of how the UK clothing market is doing.
17 October 2005
Next announces sales increases
US sportswear and promotional products leader Next Inc has announced an increase in net sales of 39.4 percent to $8.4 million (£4.8 million) for the third quarter ended 31 August 2005. Gross profit – after cost of sales – climbed 21 percent to $2.2 million from $1.8 million in the same quarter last year. Operating income rose 48.9 percent to $350,510, but net income was down 5.7 percent to $103,444 compared with $109,673 during the same period last year, due to higher interest cost.
Net sales for the nine months ended 31 August rose 29.6 percent to $17.9 million, while gross profit climbed 15 percent to $4.9 million.
“ The third quarter saw a substantial increase in sales, however their gross profit margins were lower than last year,” said CFO Charles L. Thompson in a statement. “The apparel embargo with China prevented them from taking advantage of their best sourcing options, which resulted in lost opportunity cost. Also, they received the largest order in Company history, for a major customer which comprised 45 percent of total sales for the quarter.”
10 October 2005
Next to join up with Planet Sports?
Leading British fashion chain Next Plc might be next in line to join up with Indian lifestyle retailer Planet Sports, according to Indian media reports.
Arun Bharadwai, director of Planet Sports, told The Times of India: “We are in talks with various international brands, Next is among them.”
Planet Sports already has a franchise deal with British department store chain Debenhams, which it signed recently. It also has an agreement with US jeans and casual wear brand Guess?.
The company also has licensing rights for brands such as Wilson, Puma, Speedo and Prince, as well as for retail chain Marks & Spencer.
26 September 2005
Next Sees Sales Slide
The UK high street has seen another blow to its already underperforming retail sector with the announcement from Next stating a bigger-than-expected downturn in sales. Figures at Next have dropped by 6.3 per cent over the past 15 weeks, a sharp acceleration on the 3.5 per cent downturn in the first seven weeks of its new financial year.
Stripping out the impact of new store openings on existing outlets, the fall was 3.2 per cent, up from 0.9 per cent. The contribution from new stores saw total sales ahead by 6 per cent while the Directory mail order operation's sales rose 8.1 per cent.
Next has been one of the High Street's brightest stars in recent years but has been unable to withstand the sudden spending squeeze. The shared tumbled 27p to 1478p on news of the worse-than expected performance. Trading was active ahead of the figures, with speculators betting the shares would lose ground. As much as £300 million of stock is though to have been sold short in recent weeks, as traders gambled they would be able to buy the shares back cheaper after the trading update
19 May 2005
Tough times for Next
Next is this week expected to become the latest UK fashion chain to warn of
tough trading on the high street, despite unveiling profits at the top end of
the market's expectations. Full year profits are tipped to be about 20 per cent
ahead year-on-year at £425m. But after poor trading figures from rivals
such as French Connection, analysts expect that chief executive Simon Woolfson
will report that sales have dipped in recent weeks.
19 March 2005
Next Reports Sales Profit
Fashion retailer Next has seen like-for-like sales increase over the second half of the year, but has lowered its profit forecasts after a poor response to its end of season sale. Next said its store sales from August 3 to December 24 grew by 12.1 per cent, with like-for-like sales in the 285 stores unaffected by new openings up 2.9 per cent, below the same period last year. Total like-for-likes, including 49 stores directly affected by new openings, were up 0.5 per cent.
The Next Directory home shopping business saw sales grow by 13.4 per cent across the period, with combined store and directory sales up 12.4 per cent. Next said clearance rates for the end of season sale have been below expectations, with stock levels higher than originally planned. The company has lowered internal profit forecasts by £5m, now expecting group pre-tax profits for the full year to be in the range of £415m to £425m, which Next said is "broadly in line with market expectations".
5 January 2005
Next hopes to unveil solid sales
High street retailer Next, is hoping to unveil 'solid' Christmas sales figures
this week, bringing hope to nervous investors worried about the
downturn in consumer spending. Despite widespread fears that Next's sales and profits had been badly hit by increased competition on the high street and the decline in customer confidence, analysts believe the retailer had an 'acceptable' Christmas.
4 January 2005
Get It At Next!
The Next Directory has reconfirmed its status as the pinnacle of UK home shopping
with an accolade from readers of Company magazine.
Next Directory has picked up the Best Mail Order Award at the fifth annual Company magazine High Street Awards, for the fourth year in a row.
4 November 2004
Next best UK childrenswear
The UK fashion retailer has become a leader in the British childrenswear market. The former marketleader, Marks & Spencer, will never achieve the top position again, according to recent figures from British analysts Verdict Research Ltd. M&S now occupies the fourth position with a 5,5 % marketshare.
Next Plc is now a marketleader with a 10,7 % share of the childrenswear market, which is estimated at £ 4.3 billion. Supermarket groups Asda and Tesco have also overtaken M&S. They have achieved respective market shares of 9,2 and 6,2 % respectively. Verdict Research believes that M&S will never recover its former position, and that it is likely that Asda may even overtake Next in the future, thanks to its succesful George brand. Furthermore, Asda has expanded its collection to include a large babywear line, following a reported 4% rise in birth rates in the UK since 2003.
The mother and baby retailer Mothercare has regained its reputation as a specialist in its field with a new and improved range of producst and Boots is now also developing its mother and baby line.
18 October 2004
Next Voted Best Retailer
High Street shoppers have voted Next the best fashion retailer of the last decade. At a glittering awards ceremony at the London Hilton, Next was presented with the 'Grand Prix' Award at the tenth annual Prima High Street Fashion Awards, hosted by Jeff Banks. NEXT also collected two other accolades - 'Best Casual Clothes' and 'Best Shop Layout and Design'.
15 September 2004
Next in Footie Fever
Guys want something to jazz up your wardrobe this summer? Well if you buy nothing else new make sure you purchase uber cool flip flops from Next! Go patriotic with 'England', 'Ireland', 'Scotland' or 'Wales' mimic the streets with scribbled graffiti or follow your hero Homer!
From GBP 4.99 they won't break the holiday budget and take up minimal packing space, but will improve your style no end Go on your country needs you - its footie fever time!
15 June 2004
Next Struggles Trough Summer
Next has been another victim of the UK heatwave, reporting almost flat like-for-like sales in the in the six weeks since August 3, up just 0.8 per cent.
In the six weeks since August 3 total store sales for the clothing retailer are 17 per cent ahead of last year, with like-for-like sales in the 286 stores trading for at least a year 0.8 per cent. Underlying sales in stores not affected by new space are 2.5 per cent ahead.
The summer blip follows a first half in which pre-tax profit for the six months to July was £123.2m, up from £115.8m last year and ahead of analyst forecast of around £118m.
Next retail saw turnover increase by 21 per cent, while Next Directory turnover was up 15 per cent. Chief executive Simon Woolfson said: "After a somewhat disappointing autumn season last year we were able to make significant improvements to the spring and summer ranges.
"Our ranges were better balanced with greater choice for our contemporary customer. In addition we corrected the fit issues we experienced in some of our womenswear ranges."
Next now operates 352 stores and iss continuingto expand its retail space.
September 18 2003
Rise in Sales for Next
Next saw a 1.3 per cent rise in like-for-like sales for the first time in 14 weeks of its financial year. But the retailer said 27 of its stores had been adversely affected by the new store openings. Excluding these stores, like for like's were up 3.2 per cent on the same period last year.
20 May 2003
New business for Next
US sportswear maker Next this week reported that its largest national retail customers placed additional orders for second quarter delivery of greater than USD 2 million, a significant increase over prior year. In a press release the company said it expects to report net income and positive earnings per share in the second quarter.
Mr. Dan Cooke, Chairman of the Board and CEO, stated: "The positive results are representative of the significant planning and efforts taken by the Company's management and employees to enhance the Company's revenue base and increase shareholder value. During fiscal year 2003, we expect the Company to continue its significant internal growth trend, report positive net income and further expand through acquisitions."
April 17, 2003
Growth Next's catalogue business
British fashion retailer Next reported a sales increase of 18 per cent to GBP 2.2m in the year ended 1 February 2003. The Next Directory catalogue business had a particularly good year with sales jumped by 30 per cent to GBP 471.7m while Next Retail recorded a 16 per cent rise in sales to GBP 1.58m.
"The success of the Leicester-based company stems from concentrating on the Next brand rather than diversifying into other clothing brands", said chairman David Jones.
The strategy to focus on product development, larger stores and to build a solid mail order customer base has proven successful and will therefore be continued in the future. Next Directory today ranks among the few profitable catalogue companies in the UK. The company is extending its foreign franchise network to 59 stores, This retail network saw sales for the period grow 19 per cent and profit by 20 per cent.
March 29, 2003