Fashion group Next has reported third quarter sales at the upper end of its guidance range and warned that clothing price rises will also be at the top end of expectations.
The retailer generated a 2.2% increase in turnover in the period to October 30. Sales at the retail division fell by 0.3% and 3.3% like-for-like, while Directory was ahead 7.9%. Next had guided towards a total group sales rise of up to 3% and a retail like-for-like decline of between 1.5% and 4.5%.
Next reported: “As a result of further rises in the price of cotton, retail price rises are likely to be at the top end of our previously stated 5% to 8% range for the first quarter of next year.
“The longevity of what appears to be a speculative bubble in cotton prices will be critical in determining prices for the second quarter.”
The retailer said it faces tougher comparatives in the fourth quarter than in the third but full year profits will come in, as previously indicated, at between £535m and £560m.