20 July 2024, 13:28
By Furniture News Mar 29, 2023

Cath Kidston acquisition rounds off "a good year" for Next

Next has outlined "a good year" (ended January 2023), with trading sales up +8.4% YoY (up +4.8%, excluding the weeks flattered by lockdown in the previous year).

The period saw the retail group return £461.4m to shareholders through dividends and share buybacks, partially open its new Elmsall 3 warehouse, and add Made.com to its stable of brands, among others.

Full-price sales were up +6.9% versus 2021/22 and +20.5% against 2019/20. Total Trading Sales (including markdown), were up +8.4% versus 2021/22 and +20.6% against 2019/20.

The group delivered a profit before tax of £870m, up +5.7% versus 2021/22 and +16.3% against 2019/20 (+£10m higher than its previous guidance, of £860m).

Home sales were down -8% YoY, but up +125% Yo3Y.

The retailer says it has seen a shift back towards city centres in the last 12 months, in which it closed 17 mainline stores. Online full-price sales were up +42% versus 2019/20.

In the coming year, the group expects full-price sales to decline by -1.5% YoY, and profit before tax to be £795m. Selling price inflation is forecast to be more benign than previously thought, with LFL price inflation in spring/summer expected to be +7% and, in autumn/winter, +3% (previously +8% and +6% respectively).

Next has also announced that it has agreed to acquire the brand name, domain names and intellectual property of CK Acquisitions Ltd (Cath Kidston) from the administrator for consideration of £8.5m. The cathkidston.com domain will be licenced back to the administrators for a period of up to 12 weeks to effect stock clearance, prior to relaunch under Next's ownership.

"We have prepared (and budgeted) for a difficult year," concludes chairman Michael Roney. "We are very clear on our priorities. If we continue to improve our product ranges, relentlessly manage our costs and upgrade our customer service, whilst also developing new business opportunies, we can lay the foundations for an exceptionally strong business and still deliver healthy profits, cash flow and dividends."

Full-price sales performance in the last eight weeks were down -2% YoY, but up +21.3% against four years ago.

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