Shares in high-street chain Next (NXT) clawed back 4 per cent following a half-year update from the group, which revealed a better - albeit still challenging - second quarter. Full-price sales were up by 0.3 per cent, compared with a 0.9 per cent decline in the opening period, leaving year-to-date growth down just 0.3 per cent. Including marked-down items, total brand sales rose 1.8 per cent, helped by a stellar performance from Next Directory, where sales grew 5.4 per cent over the 26 weeks ended 30 July 2016.
Most importantly, the fashion and homewares company has assessed the impact of the outcome from the recent EU referendum. Bosses said it was too soon to see any impact on consumer demand, but admitted the devaluation in sterling would give rise to higher sourcing costs in the medium-term. That shouldn’t, however, be too much of a headache for the remainder of the year as the group is fully hedged for the 12 months ending January 2017.
Reaction from City analysts has been mixed. Shore Capital called the update "reassuring", while brokerage Peel Hunt said weather conditions were a stronger influence on sales growth than referendum aftershocks.
