Retailer Next saw its shares slide 7 per cent on Wednesday after a lacklustre trading update pointed to tougher times ahead on the high street. Although there was nothing wrong with Next's overall trading figures, total group sales were up 3.1 per cent, high street like-for-likes were down by 1.5 per cent and performance was shored up by new openings and strong figures from its online Directory business.
Next was able to reiterate full-year guidance for pre-tax profits of £535m-£560m but said: "The mood among consumers is best characterised as cautious. We believe that consumer spending will be more restrained in the second half, as spending cuts and tax rises begin to take effect." Of further concern is the forthcoming rise in VAT which, coupled with higher input costs, could see Next's selling prices rise by 5-8 per cent next spring.
