26 March 2026
If you are covering Next’s latest results, please see the following comment from Mamta Valechha, consumer discretionary analyst at Quilter Cheviot:
“Next delivered a solid set of full year results this morning, coming in slightly ahead of expectations set at its January trading update. The outperformance was driven by stronger than expected full price sales in January and better clearance rates during the end of season sale.
“Group full year revenue is up 10.8%, with the UK business up 6.9% and international up a 39.5%, and full year profit increased by 14.5%. Initial guidance for the 2027 fiscal year showed UK growth expectations increased to 2.2% up from 1.6%, while international growth has been trimmed to 14.3% from 16.5% previously. At a group level, revenue guidance remains unchanged at 4.5%.
“Trading in the UK remained encouraging in the first eight weeks of the year, and international sales were strong up until the start of the Iranian conflict. Management expects sales in the Middle East, which accounts for around 4% of group revenue, to be adversely impacted for the rest of the first half. Next has incorporated additional costs of around £15 million assuming the disruption lasts for a three month period, although these are expected to be offset by savings elsewhere, resulting in no impact on profit before tax. However, should the disruption persist beyond this, the group has indicated it would look to pass costs through via higher pricing.
“Next’s valuation has reduced since the start of the year, falling from 18 times earnings at the start of the year to 15.6 times. This is broadly in line with its three year average of 15 times, and offers an attractive entry point into a high quality retailer with a 5% dividend yield.”
