Next cautious on consumer confidence

Next said total sales in the first half of the year have been in line with expectations, despite a cooling in demand in recent months.

Sales rose by 3.1% in the half year to end July, with catalogue and online sales strong and a decline on the high street.Retail rose by 1.3% as online business growth offset a like-for-like fall of 1.5% from store sales. Directory sales jumped 7.8%.

Overall, the figures were in the middle of Next's previous guidance. Good cost control will mean group operating profit for the first half will be in the region of 15% up on last year, the group said.

Retail sales are forecast to fall by 1.5% to 4.5% like-for-like, due to the planned VAT hike and last winter's strong performance. Directory sales are tipped to grow by between 4-8%.

"Based on achieving our sales budgets in the second half, which are within the above guidance, we believe that group profit before tax will be in the range £535m to £560m. This would represent an increase over last year of 6% to 11% and is in line with current market expectations," Next said.

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