Next to post jumbo profit haul

SEASONED retail veterans may have been through one of the toughest trading periods in living memory, but high street fashion chain Next looks set to buck the sector trend when it reports a 15 per cent surge in full-year profit later this week.

Next is expected to post a pre-tax profit of around £495m at its annual results on Thursday – a £66m improvement on last year’s figures and in the middle of its own improved forecast range.

The bumper haul has been boosted by a particularly strong performance in the second half of the year, during which Next’s stores are predicted to post a three per cent hike in like-for-like sales and its directory business an even more impressive 6.8 per cent rise.

However, chief executive Simon Wolfson is expected to remain cautious as to the outlook for the new financial year. Next said in a pre-close update in January that it expects profits for this year to come in at a similar level to 2009/10, while the company provided muted like-for-like sales growth guidance for both its retail and directory businesses.

Charles Stanley analyst Sam Hart said: “The trading environment is likely to become tougher in the second half of 2010/11, but we expect the group to continue to deliver solid growth in underlying earnings and dividends. Next remains among the best managed companies in the sector.”