Next has reported a 14 per cent slump in pre-tax profits to £428.8m in its year-end results, but vowed not to change its Sales strategy in line with the rest of the high street.

Chief executive Simon Wolfson said that while promotional activity on the high street will continue, Next “intends to continue trading at full price at all times, other than at our traditional end of season and mid-season Sales”.

He said: “Any increase in promotional activity must logically involve either the surrender of margin, or the artificial raising of initial prices in order to offer them as a ‘bargain’ at a later date. Whilst some have made a success of this strategy, we do not believe that this would be right for the Next brand.”

Next revealed retail like-for-likes were down 6.5 per cent, within the guidance range of down between 3 and 7 per cent. Directory sales were up 2.1 per cent, just ahead of guidance of between 0 and 2 per cent.

Next said it put 15 per cent less stock into the end of season Sales as a result of “effective stock control”.

During the year, Next increased trading space by 305,000 sq ft in the full year, increasing its portfolio of 510 stores.

The fashion retailer said that while the homewares market is difficult, it believes there are significant long-term opportunities for Next to gain market share. It has opened 10 standalone home stores, which are all successful apart from its only city-centre store.

Next said its balance sheet and cash flow remains robust. The reduction in net debt after buybacks was£111m.

Internationally, sales and profits were up 27 per cent. Profits were boosted by savings in operational overheads, the non-recurrence of China start-up costs and foreign exchange gains.

Wolfson said: “Weakness in the general economy means we must plan for a fall in like-for-like sales for the full year. In addition, weakness of sterling will put strong upward pressure on cost prices. Despite the challenges, we still plan to deliver healthy net margins of more than 10 per cent, generate over£100m of net cash and achieve profits in line with current market consensus.”