Profits will fall but boss says Brexit does not affect spending | Business

Next announced a third consecutive year of declining profits after a "difficult" year in which its sales and profits deteriorated sharply.

The retail giant made a pre-tax profit of 722.9 million pounds sterling in January, compared to 726.1 million pounds sterling on 26 January. However, the fortunes of its stores and its distance selling sector were very uneven: the profits of the retail chain dropped by more than a fifth to 212.3 million pounds sterling, while its online business grew by almost 14% to £ 352.6 million.

Its chief executive, Simon Wolfson, a conservative peer and an influential supporter of Vote Leave, said the upheaval around Brexit was not currently affecting consumer spending.

"Our feeling is that the subject is tired, which makes consumers insensitive to the daily fluctuations of political debate," said Wolfson. "It seems to us that consumer behavior will only be significantly altered if the departure of the UK from the European Union starts to affect employment, prices or incomes."

Next said that the interim import taxes described by the government as a temporary no-reduction plan would reduce its tariff bill by about 12 to 15 million pounds, an economy that would be pbaded on to buyers thanks at lower prices.

"This savings would result from the fact that the tariff reductions proposed by countries outside the EU would be more than offset by any increase in tariffs on the products we currently buy from the EU and Turkey," he said. explained Wolfson.

Overall group sales increased 2.5% to £ 4.2 billion. Sales in Next stores opened more than a year ago decreased by 8.5%. The chain yielded nearly £ 170m in revenue to generate sales of £ 1.95m. Sales of its teleshopping segment grew by almost 15% to £ 1.9 billion.

"The continued success of its catalog and online offering gives Next a considerable advantage over its competitors, and continued investments in its online offering will ensure its future success," said Julie Palmer, partner at Begbies Traynor.

"However, it is not easy for this iconic retailer, which is suffering from a double setback: the drop in street sales, combined with rising staff salaries, which will continue to affect its bottom line. As such, store closures on the main streets are on the agenda in the next year. "