Fashion retailer Next has bucked the downward trend among retailers on UK High Streets with news that profits are going to more than expected.
The squeeze on household incomes and the cost-of-living rises has been taking its toll on High Street sales for months.
Next profit guidance up by £10 million.
Despite this Next has raised its guidance for annual profit by £10 million to £845 million following successful summer sales, Reuters reported. Yet, despite the buoyant figures, they will still come in 2.9% lower than it made in 2022-23.
Next has long been seen as a bellwether for retail sales and these figures show shoppers are defying harsh economic conditions and a year of high inflation.
Profits amid High Street retreat.
At a time when many retailers are leaving UK High Streets, Next holds onto 500 stores, plus an online retail platform.
Long standing retailers Primark and Sports Direct-owner Frasers Group have both, in recent weeks, issued positive updates.
Its Yeezy for Adidas
Meanwhile veteran High Street label Adidas cut its losses with a smart bit of business to sell its way out of a brand disaster.
The sportswear manufacturer tried to offload a mountain of its Yeezy shoes after a chaotic break up with designer Ye – previously known as rapper Kanye West – over alleged antisemetic comments.
Shoppers queued up to buy the surplus Yeezy shoes spending 400 million Euros in the second quarter.
“A good outcome”
This fire sale helped narrow a projected full year loss to 450 million euros down from the expected 700 million euros.
“For Adidas to sell the Yeezy stock well, without a lot of negative media or consumer backlash, is a good outcome,” Cristina Fernandez, managing director and senior research analyst at Telsey Advisory Group in New York told Reuters.
110 million euros for charity.
The next Yeezy stock sales are also likely to attract strong demand, but may not be as profitable as the first drop, Fernandez said, as Adidas is including wholesale partners rather than only selling through its own channels.
Adidas also set aside 110 million euros in the quarter for donations to charities including the Foundation to Combat Antisemitism and the Anti-Defamation League, a step it had previously announced in a bid to mitigate the impact of Ye’s public antisemitism.
