Clothes retailer Next shrugs off UK cost-of-living crisis

Shoppers, some wearing face coverings to combat the spread of the coronavirus, walk past stores in Camden in London, on January 7, 2022, as UK businesses and consumers face mounting fallout from surging inflation, including higher interest rates. – Restrictions imposed in the wake of the Omicron coronavirus variant have “wiped out” much of a recent recovery enjoyed by UK bricks-and-mortar stores, the British Retail Consortium revealed Friday, January 7. (Photo by Tolga Akmen / AFP)

London, United Kingdom (AFP)

Shares in UK clothing retailer Next soared to the top of the London market Thursday after it said colder weather boosted purchases despite a cost-of-living crisis caused by sky-high inflation.

Next’s share price jumped seven percent to £65.26 ($78.53) on the benchmark FTSE 100 index, which was up modestly overall.

Sales of full-price items rose around five percent in the nine weeks to December 30 from a year earlier, the company said in a statement.

That beat its own guidance for a modest decline and sparked an upgrade to its final 2022 earnings due in March.

Annual pre-tax profit was now expected to climb 4.5 percent to £860 million ($1.0 billion) from the previous year.

That compared with prior guidance of £840 million.

Next said it experienced a “dramatic boost” to sales when the weather turned colder in December.

“We believe that the strength of demand for cold weather products in December was partly a result of pent-up demand from an unusually warm October and November,” it added.

However, the group expects sales to dip 1.5 percent over the year as a whole, with consumer sentiment dented by persistently high inflation.