Next hits record high as profits at the the fashion chain head towards £1bn mark

The Next boss said the outlook for households is the best it has been since pre-Covid as it heads towards a £1 billion profit.

With inflation falling and the economy recovering, Simon Wolfson said “we feel like we are now entering a new era”. The comments come as the High Street retailer said it expects profits to hit £960m this year.

Tesco, Marks & Spencer and Kingfisher, owner of B&Q, are the only other UK state-owned retailers to have raked in £1 billion in profits in a single year.

Next also said full-price sales are expected to rise by 2.5 per cent as shoppers have more money in their pockets thanks to higher wages.

In a further boost, Next announced that there would be a “slight reduction” in prices this year. The dose of optimism sent the shares up 6.7 per cent to a record high of 9,078p, making it worth £11.5 billion.

Wolfson hailed falling inflation as “encouraging” for consumers, while wages rising faster than prices will “ease the pressure they have felt on their cost of living over the past 18 months” .

The tone was unusually upbeat from the businessman, who has been praised for his leadership at one of Britain’s biggest retailers.

Russ Mould, investment director at AJ Bell, said: “Not all retail businesses are created equal…the excellent way in which Next as a business has been positioned helps to underpin and deliver credibility to his optimistic outlook.

Releasing its results for last year, Next said profits rose 5 per cent to £918 million, while sales rose 5.9 per cent to £5.8 billion. But Wolfson warned against “wild optimism.”

He said: “That’s not to say that we think the consumer environment is going to be extremely exuberant, we just don’t think the consumer is going to face the same headwinds that they faced at the same time last year. last year.”