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Clothing retailer Next has posted a 15% fall in full price sales and pre-tax profit in line with guidance as most of its stores remained closed for a 'significant portion' of 2020/21 and forecast that the shift in consumer behaviour towards online sales is set to continue.
The retailer reported total group sales decreased by 15% to £3.6 billion in the year ending January 2021, and pre-tax profit of £342 million, down from £729 million in 2019/20, in line with the central guidance issued in its January 2021 trading statement.
It reduced net debt during the year to £610 million, from £1.1 billion the previous year.
The company has not proposed a final dividend for 2020/21 and said that its share buyback programme remains suspended due to the 'continuing uncertainty' around when stores will reopen.
Next reported that since January 2005, its online business has increased from 23% of the company's revenue to an estimated 71% in January 2022.
It said that in the first eight weeks of the 2021/22 year, online sales have been stronger than expected and are up more than 60% on two years ago.
The company said: 'This overachievement plus the expected transfer of sales from retail during the additional two weeks of lockdown, are expected to add £30 million of profit. As a result, we are raising our central profit guidance by £30 million from £670 million to £700 million.'
Chairman Michael Roney said: 'We expect the shift in consumer behaviour towards online sales to continue for some time and one of our priorities during the year has been to continue the development of our online platform. We accelerated part of our planned capital expenditure in the online business, spending £121 million on warehousing and systems.'