Next's share price falls on lower Q3 sales growth
Warmer weather in the UK has resulted in lower-than-expected sales growth for Next
UK fashion retailer Next Plc saw its share price fall 4.1% this morning (30 September) after warmer weather led to lower-than-expected third-quarter sales growth.
The company said warmer weather in the "more important" month of September has resulted in third-quarter sales growth to date of 6% - lower than earlier expectations of a 10% increase.
Although Next's full-year pre-tax profit forecast remains unchanged at GBP775m-815m (US$1.26-1.32bn), the group said if the unusually warm weather continues throughout October, this could be lowered.
Cantor Fitzgerald analyst Freddie George believes Next may not be the only retail chain to be impacted by the warmer weather. "The impact of the mild weather, which we have been flagging up over the last two weeks, is impacting all retailers in the UK and is only a temporary phenomenon.
"The underlying trends, in our view, remain positive."
Earlier this month Next booked a double-digit increase in first-half profit, thanks to what it described as its "strongest sales growth for many years".
In addition, the fashion giant detailed the progress it has made in upgrading the quality and design of its product ranges, new and improved sources of supply, and the introduction of premium priced merchandise.
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