Next Shares Rise: Sees Brighter Than Expected Christmas Trading, Raises Full Year Guidance

NEXT PLC (NXT.L) saw its share price climb at the open on Tuesday after it announced a robust trading statement for the nine weeks leading up to December 27, 2025, exceeding internal expectations and prompting an upward revision of full-year profit guidance.

The markets are reacting positively to the news, with increased investor interest.

Full price sales surged 10.6% compared to the previous year, surpassing the company's initial guidance of 7.0% for the quarter. UK sales saw a healthy increase of 5.9%, while international sales demonstrated exceptional growth of 38.3%. This performance is attributed to higher stock availability and increased marketing expenditure.

The over-achievement in sales, coupled with anticipated additional sales in January, has led NEXT to increase its full-year profit before tax guidance by £15 million to £1,150 million. This adjustment indicates a 13.7% increase in profit before tax compared to last year, with post-tax Earnings Per Share (EPS) now expected to rise by 16.1%.

This improved profitability allows NEXT to propose a substantial capital return to shareholders via a B Share Scheme, totaling £421 million, or £3.60 per ordinary share, subject to shareholder approval.

The company also intends to distribute £768m to shareholders, including ordinary dividends, representing 4.8% of the current market capitalization.

Driver Breakdown:

• International Online Growth: A 38.3% surge in international online sales, driven by increased marketing expenditure and improved stock availability through the ZEOS platform.
• UK Sales Resilience: UK sales grew by 5.9%, benefiting from improved stock levels compared to the previous year, mitigating potential slowdowns.
• Profit Neutral Clearance: Higher end-of-season sale stock was offset by better-than-expected clearance rates, adding £30m to total Group sales without impacting profit.

Looking ahead to the year ending January 2027, NEXT anticipates full price sales growth of 4.5% and group profit before tax of £1,202 million, also a 4.5% increase. EPS is projected to grow by 4.3%, assuming no further share buybacks. This forecast reflects a more cautious outlook, considering tougher comparatives in the UK and potential pressures on consumer spending.

The company is forecasting a total shareholder return of 9.1%, combining anticipated shareholder distributions with forecast EPS growth. This figure assumes a constant price-to-earnings ratio.

NEXT plans to announce its full-year results for the year ending January 31, 2026, on Thursday, March 26, 2026.