NEXT plc (LON: NXT) shares are up around 2.8% at the open on Thursday after the company reported a better-than-expected first half, with full price sales up 7.7% and total sales including markdown rising 8.9%.
Group sales, which include subsidiaries, increased 9.0% to £3,540m in the 26 weeks to late July. Profit before tax climbed 10.5% to £569m, while post-tax earnings per share rose 12.2% to 370.4p.
On the back of the performance, the retailer has increased its full-year profit guidance by £12m to £1,255m, citing a modest upgrade to sales expectations along with additional cost savings, primarily in warehousing.
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International online sales were a standout, up 23.9% in the first half, prompting the company to raise its full-year guidance for that division to 20.5% growth.
NEXT said returns on digital marketing spend overseas had held up despite a 63% increase in marketing expenditure, helped by improved use of local languages, better targeting technology, and reduced competition from some overseas retailers following the EU’s new charge on low-value imports.
UK sales were more modest, with total UK growth of 3.6%, and the company trimmed its second-half UK guidance slightly, from 2.8% to 2.0%, citing concerns over inflation, higher mortgage costs and a weakening jobs market.
NEXT also highlighted progress on artificial intelligence within its technology division, including early piloting of AI agents for coding and business analysis, and continued investment in warehouse automation aimed at reducing costs per unit and improving delivery service levels.
