The outlook from Next (NXT) chief executive Lord Wolfson is less than inspiring. The respected retail boss said 2016 would be a challenging year with "much uncertainty in the global economy". He pointed out that although employment rates are at an all-time high, growth in real earnings has slowed significantly since late last year, and growth in output across services, manufacturing and construction have all decelerated. Additionally, it's also the company's view that there may be a cyclical move away from spending on clothing, back towards experience-based segments such as eating out and recreation.
More specifically, bosses reckon core sales could land anywhere between shrinking 1 per cent and growing 4 per cent this year, although a colder winter could provide strong upside to those numbers. That equates to a profit range of £784m to £858m, which has forced some analysts to trim forecasts. Peel Hunt took the opportunity to downgrade pre-tax profits forecasts by £20m for the current financial year to £840m, giving EPS of 448p, compared to £821m and 443p in FY2016.