Next narrows full-year sales forecast following tough Q3 trading

Next has narrowed its full-year sales forecast after posting Q3 figures that reflected tough trading on the high street and the increasing challenge of selling full-price product.

Sales in the three months to 31 October were down 3.5% on last year. Directory sales were flat year-on-year but retail was down by 5.9%, which was a better performance than analysts' forecasts of flat Directory sales and a drop in retail of 7.6%.

As a result of the quarter's trading the bellwether high street retailer has narrowed its full year sales forecast to -1.75% to +1.25% (or £785m – £825m) for the full year to 31 January 2017 from the previous guidance of -2.5% to +2.5% (£775m – £845m), which gives a marginally lower mid-point. However, due to cost savings, it is holding its profit forecast of £805m.

Total sales of the year to date are up 0.4% however full-price sales for the year to date are down 1.5% on last year. "In September we gave guidance that trading in the third quarter would be difficult. In August full price sales were subdued following the much larger end-of-season Sale in July, and in September we traded against our best month last year," the retailer said in its statement.

However it pointed out that October sales had improved "significantly". Full price sales in August were down 7% on the previous year, in September they were down 5.1% but by October full price sales had improved by 1.3%.