8th May 2008 07:01
Next PLC08 May 2008 Date: Embargoed until 07.00am, Thursday 8 May 2008 Contacts: Simon Wolfson, Chief Executive David Keens, Group Finance Director NEXT PLC Tel: 0844 844 8888 Alistair Mackinnon-Musson Nicola Savage Hudson Sandler Tel: 020 7796 4133 Email: next@hspr.com Photographs available: http://www.next.co.uk/press/ next plc Interim Management Statement FIRST QUARTER SALES The combined sales of Next Retail and Next Directory for the first quarter from27 January to 26 April 2008 were down 3.9% compared to the same period lastyear. Next Retail sales in the period were down 5.0% on last year. Like for likesales in the 340 stores that were unaffected by new openings were down 8.9%. Next Directory sales were down 1.0% on last year. The table below sets out the sales performance compared to last year. Sales (£ millions) 13 weeks to 13 weeks to 26 April 2008 28 April 2007 Change Next Retail 518.1 545.7 -5.0%Next Directory 220.8 223.2 -1.0% Total Next Brand 738.9 768.9 -3.9% SALES PROSPECTS We remain cautious about the outlook. Financial pressures on our customersresulting from cost increases in food, fuel, mortgage repayments and taxationlook set to continue. However, we continue to believe that sales in the secondquarter will improve significantly as a consequence of last year's unusualweather patterns and we have budgeted on this basis. Even within the lasteleven days, Next Retail sales have picked up markedly with the arrival ofwarmer weather and the cumulative performance from 27 January to Wednesday 7 Mayhas improved to -3.8% (with like for likes at -7.8%). We now expect that total Next Retail sales for the first half will be down byaround -3.5% with like for like sales at the bottom end of our forecast range ataround -7%. We had planned for weak demand and remain confident that we willhave less stock for the end of season Sale than we had at the same time lastyear. As a result, we are not planning any additional markdown activity. We continue to anticipate Directory sales will be up between 0% and 2% for thefirst half. OPERATING UPDATES We estimate that net additional space in Next Retail will be 110,000 square feetin the first half and 275,000 in the second half, making 385,000 for the year.The store refit programme continues as set out in our March announcement. AtJanuary 2009 we will be trading from 5.6 million square feet in total, of which4 million will be new, refitted or redecorated in the new format. Despite the difficult economic climate we continue to see no deterioration inNext Directory bad debt, which is a result of tighter credit controls. PROFIT PROSPECTS Our internal forecasts for full year profits are closely in line with marketconsensus. The majority of forecasts are in the range £475m to £505m for profitbefore interest and £430m to £460m for profit after interest. SHARE BUYBACKS Prior to our January 2008 year end, we entered into contingent share purchasecontracts as shown in our Annual Report. This year these contracts havedelivered 2.2 million shares at a cost of £30m and if these contracts continueto maturity then a further 1.7 million shares will be purchased for cancellationat a cost of £23m. AGM 13 May 2008 This Interim Management Statement replaces the trading update which in previousyears has been given on the day of the AGM. Consequently no further TradingStatement is intended until after our half year, which ends on 26 July 2008. - END - This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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