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Retailer Next has announced that full price sales in the 54 days from 1 November to 24 December were up 1.5 per cent on last year.
Retail sales fell by 6.1 per cent, but this was balanced out by strong online sales which grew 13.6 per cent. This brings Next’s estimated full year PBT to £725m. EPS growth fell by 5.7 per cent versus 2016/17.
Richard Lim, Chief Executive, Retail Economics said: “These results highlight the relentless shift towards online spending with high street stores remaining in desperate conditions. The cooler weather is likely to have played a helping hand but these results set the tone for a tough Christmas.
“On the one hand, the aggressive growth of the more nimble, pure-online players is radically changing the competitive nature of the clothing sector. On the other, the prolonged frenzy of promotions since Black Friday, against a backdrop of rising sourcing and operating costs, is decimating profit margins.
“The length, breadth and depth of discounting this season has been astonishing. Just how much damage all of this discounting has inflicted on gross margins will be under close scrutiny.”