Subsequent Ups Revenue Steerage on Worldwide Development

Subsequent has stated worldwide tastes in vogue are “converging” as tech platforms expose shoppers to worldwide tendencies, boosting the retailer’s abroad gross sales and serving to it shut in on £1 billion in annual earnings for the primary time.

The style and homeware retailer forecast its annual earnings at £15 million greater than beforehand anticipated, at £995 million — up from the £918 million recorded in 2023 — after abroad gross sales rose by 23 p.c within the six months to July, offsetting a close to 1 p.c decline in gross sales of Subsequent-branded clothes within the UK.

The corporate stated that the “world attain” of tech platforms together with Netflix, YouTube and TikTok had been “exposing folks to worldwide vogue tendencies in a means they by no means have been earlier than”, and enhancing worldwide supply networks had been additionally encouraging “shoppers to strive garments from different international locations, and retailers to adapt their ranges that cater for abroad tastes”.

“It seems that worldwide tastes in clothes are converging extra quickly. This convergence shouldn’t be uniform and is extra pronounced in some territories than others,” the retailer stated, including that there stays a “marked distinction between totally different cultures and climates”.

Simon Wolfson, the chief govt of Subsequent, stated the enterprise was “at first of a brand new section” with greater than half of its gross sales and earnings now on-line and fast progress in gross sales of non-Subsequent manufacturers, a few of which the group now owns.

Non-Subsequent manufacturers now account for 17 p.c of abroad gross sales and the group stated it had been experimenting with increasing wholly owned labels together with Cath Kidston, after it purchased the model title out of administration final yr, and Love & Roses.

The group has signed a partnership deal in India with the native operator Myntra to develop on-line and retail shops and can increase a take care of the US division retailer chain Nordstrom, the place it’s now promoting childrenswear, and in addition expects to search out related companions in Japan, China and Australia.

Subsequent additionally plans to enhance the best way it really works with cargo hubs within the Center East and Europe to assist higher serve customers in these territories.

The plans had been introduced as Subsequent revealed that full-price gross sales rose by 4.4 p.c within the six-month interval, boosting whole group gross sales by 8 p.c and pre-tax revenue by 7.2 p.c to £452 million.

Subsequent stated that full worth gross sales over the six weeks after that interval had “materially exceeded our expectations” and had been up by 6.9 p.c as higher climate helped increase commerce.

Gross sales within the second half of the yr are actually anticipated to rise by 3.7 p.c, up from 2.5 p.c.

If Subsequent had been to hit £1 billion of earnings for the primary time, it could be a part of solely a handful of UK retailers which have performed so, together with Tesco — and Marks & Spencer in a earlier period. The improve to its revenue expectations lifted Subsequent’s shares by 5.5 p.c to an all-time excessive of £109.10 in early buying and selling.

By Sarah Butler