Next has become the latest member of the elite club of British companies making more than £1 billion profit a year.
The high street fashion chain said pre-tax profits for the year to end January rose 10.1% to £1.011 billion from £918 million.
It joins only Tesco, Marks & Spencer and B&Q owner as British retailers that have measures their profits in ten figures.
Chief executive Lord Wolfson sought to paly down the achievement saying: “ To some it may seem an important milestone, even a cause of celebration. We do not share that view, not least because profits can go down as well as up. In fact, we think it would be a big mistake to view the company differently just because it has passed any milestone.”
He added: “A colleague, frustrated at the cost constraints they worked within, was heard to say that: “surely, now we are making a billion, the company can buy me a new laptop”. Buying that laptop may well have been a good investment, but reaching £1 billion profit does not make it more worthwhile. “
Next earned the profits on sales up 8.2% at £6.32 billion.
It upgraded its guidance for profit in the current year by £20 million to £1.066 billion, up 5.4%. Sales for the year are expected to be 5% higher compared with previous guidance of 3.5%.
Sales from the 457 branch UK store chain were down around 1% to £1.85 billion while profits fell 3% to £204 million. Ten new store openings are planned for the current year in the first increase in trading space in five years.
UK online sales were up 4.6% at £2.54 billion with profits 8% higher at £444 million.
The international business saw the strongest growth with sales up 27% at £930 million and operating profits 36% higher at £131 million.
In his review of the year Lord Wolfson said:” It is unusual for Next to begin a year on an optimistic note, yet that was our stance this time last year. It felt as though the company was entering a new era: the worst of the retail-to-online structural shift appeared to be behind us, the pandemic was well and truly over, and the cost of living crisis was abating.
“That cautious optimism appears, now, to have been well founded; and the company went on to deliver growth in pre-tax EPS of more than 10%. We are as positive about the company today as we were then, albeit in an environment where the risks to the wider UK economy are growing.”
John Moore, senior investment manager at RBC Brewin Dolphin, said: “Next continues to find ways of growing sales and its bottom line, despite the well-publicised challenges facing consumers and the retail sector at large. Profits have reached the £1 billion milestone, sales for 2025 so far have been ahead of expectations, and guidance for the year has been raised – it’s a strong report card.
“Inevitably there are challenges ahead, not least in balancing increasing costs with fragile consumer sentiment, as well as signs of weak clothing pricing in the latest inflation data. However, with international expansion surpassing the company’s own predictions and increased National Insurance contributions already accounted for, Next is well placed to navigate any obstacles – as it has done time and again.”
