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DOES NEXT'S PROFIT UPGRADES BOOST YOUR FAITH IN RETAIL ?

<strong>RICHARD HUNTER </strong> HARGREAVES LANSDOWNE<br />In the midst of the current economic malaise, Next has been making outstanding progress. The early indications from its current summer sales are encouraging, whilst overall sales are in positive territory - almost inevitably helped along by a decent contribution from the Directory business. Meanwhile, the recent bout of good weather has also boosted seasonal clothing sales.<br /><strong><br />TONY SHIRET </strong> CREDIT SUISSE<br />Next is now guiding for a &pound;15m increase to its own internal profit forecasts for the first half of the year driven by better full price Next Retail sales and improved clearance rates as well as an additional &pound;15m increase to profits in the second half to reflect a better bought in gross margin outcome. We regard Next as a continuing safer company than its peers.<br /><strong><br />MATTHEW MCEACHRAN </strong> SINGER CAPITAL<br />Although Next has performed well over the last three months, we see scope for further out-performance later in the year. The warmer weather drove sales of summer clothing, and management estimate that the boost was between two per cent and three per cent. After adding the additional &pound;30m of profit guidance we expect market estimates of &pound;400-405m.