NEXT Survives Cold Weather to Push Sales Up

Watch stocks you care about

The single, easiest way to keep track of all the stocks that matter...

Your own personalized stock watchlist!

It's a 100% FREE Motley Fool service...

Click Here Now

LONDON -- NEXT  (LSE: NXT  ) continued its steam-rolling success as the high-street retailer posted positive quarterly sales in an interim management statement, with the market responding by pushing the shares up 129 pence, or 2.9%, in early trade.

Excluding VAT, brand sales for the first quarter to May 4 saw an increase of 2.2% year on year, while expansion yielded 1.5% of that figure following the opening of profitable new space. 

The hugely successful online and catalog service NEXT Directory contributed an 8.9% uplift, outweighing a decline in retail sales of 1.9% following volatile trading in no small part due to the unseasonable cold weather that the U.K. suffered from in March and most of April.

Overall, then, brand sales came in at just below the midpoint of the guidance range given in March of +1% to +4%, but investors were cheered by this figure nonetheless due to the aforementioned abnormally cold spring that has affected the vast majority of retailers.

After confirming that sales have rocketed from the week beginning April 13, management stated its belief that neither the poor prior four weeks or the booming period since is "indicative of any significant change in the underlying economy," though it did reiterate its caution about the consumer environment. Furthermore, its expectations are that "the continuing decline in real earnings will depress discretionary spending for at least the next eighteen months, if not longer." 

Guidance for the full year continues between +1% to 4%, with a profit range of 615 million pounds to 665 million pounds. NEXT shares now trade at an all-time high of around 4,525 pence and offer a consensus yield of 2.4%, just shy of the FTSE 100's average of about 3.2%. Bearing in mind that as recently as July 2008 the shares traded at 9.54 pence, the company has shown impressive growth under a solid management team -- despite the expensive valuation, there's still a lot to like about NEXT.

If you're looking for another company that should soar in price, though, we've pinpointed our favorite growth share and produced a special report in which we evaluate its finances, risks, and growth prospects going forward. Simply click here to get your copy delivered to your inbox immediately -- completely free.


Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2419212, ~/Articles/ArticleHandler.aspx, 10/27/2016 6:41:18 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated Moments ago Sponsored by:
DOW 18,169.68 -29.65 -0.16%
S&P 500 2,133.04 -6.39 -0.30%
NASD 5,215.97 -34.29 -0.65%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

10/27/2016 12:06 PM
NXT $4772.73 Up +42.73 +0.90%
Next CAPS Rating: No stars