Online sales soften lockdown blow to Next

Online sales at Next almost made up the fall in shop sales during lockdown, according to the firm's nine-week results covering the period up to 26 December.

Full price sales were down 1.1 per cent on the same period last year, said Next, and “much better” than the -8 per cent guidance given in the firm's October trading update.

Next has estimated a £58 million lockdown hit to profits between this January and March if stores remain closed for the full period.

Next said: “The sales gained in our online business compensated for almost all those lost in retail stores, with total product full price sales down just -0.5 per cent.”

In the fourth quarter, total online sales (including reduced items) were up 38 per cent, while all shop sales were down 43 per cent.

Total active online customers jumped 24 per cent in a year, driven by new UK and overseas cash customers that do not use a Next credit account.

Products that did well during the lockdown were childrenswear, home items, loungewear and sportswear.

Products that fared less well included adult clothing for work, parties, events and going out.

Returns rates continued to be much lower than last year - 21 per cent compared to 36 per cent last time.

Stores located in out-of-town retail parks continued to perform around 15 per cent better than those in city centres and shopping centres when it came to sales.

For the whole year to the end of January, Next expects pre-tax profits to be £342m - less than half of the £728 million last year, with full price sales down 16 per cent.

The actual full-year results will be posted on 1 April 2021.

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