Next, a well-known clothing company has reportedly slashed its sales forecast for the latter half of this financial year along with the annual profit guidance. Amidst the rising economic crisis, the shares of the firms depending on consumer spending have tumbled in the U.K.
During the release of its half-year results for July, the company said that there were too many variables at play to predict consumer demand in advance due to the ongoing cost-of-living crisis.
Next, a well-recognized name as a consistent street performer recently stated that it had a better than expected first half, with sales going up by 12.4% from the same period of last year.
As reported, the profits were also 16% higher before being taxed at $388 million (£401 million).
However, it also disclosed that sales suffered during August, although some demand has returned in the current month.
Next, which operates in more than 500 stores, said it expects full-price sales in its second half to fall by 1.5%. Earlier, it had guided an increase of 1%.
While the forecasted full-year pre-tax net profit fell by $19.3 million (£20 million) to $814 million (£840 million), it still represented a 2% increase over 2020/21.
The firm’s shares also dropped by 10% in early deals. Additionally, the consumer-facing stocks and the shares of street rivals also suffered.
As per the data, the FTSE 100 and FTSE 250 indexes were also down by over 2%, and the rising recessions fear is also evident, with the French CAC and German DAX also reporting low.
Reportedly, housebuilders and personal investment firms were among the worst hit on the London Stock Exchange.
Next also hinted at the belief to benefit from the measures taken by the government, which includes help for household energy bills, but admitted that it is difficult to predict the future.
Notably, the economy is facing difficulties on numerous fronts, with the mini-budget imposing tremendous pressure on government bonds and the pound falling to a record low this week.
Source credit - https://news.sky.com/story/next-cuts-sales-and-profit-guidance-as-it-eyes-uncertain-winter-ahead-12707290