However, current trading has weakened in the seven weeks to March 18. Like-for-like sales were down 9 per cent, excluding those stores affected by store openings.
Chief executive Simon Wolfson said: 'We have succeeded in mitigating the effects of a tough consumer environment by profitably growing our selling space, improving gross margins, controlling costs and managing stock levels.'
Overall pre-tax profit was up 5.8 per cent to£449.1 million. However, like-for-like sales at the group's 224 stores over the full year were down 2.4 per cent. The company was also hit by the increase in energy and rent costs.
From May, Next will be trialling a new shopfit concept in six new stores and two existing shops. If successful, elements will be rolled out to other key stores.
The group reported a good year for the Next Directory business. Sales increased by 13.7 per cent and profits were up 18.5 per cent. Success was put down to an increased use of the internet and tight control of costs. However, the company admitted improvements in the gross margin were offset by a significant increase in markdowns.
The company said a late Mother's Day and Easter has hit current trading.
Numis analyst Steve Davies said: 'Next results for the year to January are at the top end of expectations, but the current trading update is very weak indeed.'
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