Next raises profit guidance

Next raised its full-year profit guidance after posting an 8.5 per cent rise in half-year profit, driven by a strong performance from its Directory home shopping business.

The firm, which runs over 500 stores in Britain and Ireland, said it made a pre-tax profit of £228m in the six months to 30 RETAILJuly.

That compares with analyst forecasts of £205-231m and £213m in the same period last year.

Next, which battles the mid-market with sector leader Marks & Spencer said revenue rose 3.6 percent to 1.57 billion pounds.

Sales at Next stores fell 1.7 per cent, while Directory sales leapt 15.1 per cent.

The firm said it now expected a year to end January 2012 underlying pre-tax profit of 545-590 million pounds, representing a rise of 0.4-8.7 per cent on the previous year.

Its previous guidance was pretax profit of £527-577m.

Next reiterated that it expects pressure from rising costs, like higher cotton prices, to ease next year.

Its average selling prices rose about seven per cent in its first half. It expects them to be up about 8 percent in the second half.

The firm is paying an interim dividend of 27.5 pence, up 10 per cent.