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Next has raised its profit forecast for the fifth time in less than a year after reporting better-than-expected sales in the run-up to Christmas.

The high street retailer said full-price sales were up 5.7% in the nine weeks to 30 December compared to last year.

The figure, revealed in a trading update from the firm on Thursday, is £38m better than the 2% rise it previously forecast for the period.

As a result, Next said it was upgrading its pre-tax profit guidance for 2023/24, not including exceptional items, by £20m to £905m.

That would represent a 4% rise on the £870m it made in 2022/23.

The chain, which has around 460 stores in the UK and an online presence in dozens of countries abroad, reported particularly strong website sales, which increased 9.1% in the nine weeks to the end of last month.

Next said it expects full-price sales to rise 2.5% in 2024/25, and pre-tax profit to increase by 5%.

The company said rising wages were likely to ease cost of living pressures on shoppers in the new year, while it also aims not to rise prices for like-for-like goods thanks to falling manufacturing costs.

Its trading update said: “On the face of it, the consumer environment looks more benign than it has for a number of years, albeit there are some significant uncertainties.”

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Risk factors identified by Next for the new year include a potential rise in unemployment which could hit sales.

The chain also cautioned that rising tensions resulting from the Israel-Hamas war and attacks on shipping in the Red Sea could hit its supply chains.

“Difficulties with access to the Suez Canal, if they continue, are likely to cause some delays to stock deliveries in the early part of the year,” the trading update warned.

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Charlie Huggins, a manager at investment firm Wealth Club and a Next shareholder, said the company had “pulled yet another rabbit out of the hat” and claimed the figures “demonstrated once again why it is considered one of the best run retailers around”.

He added: “Next’s core proposition is clearly resonating with the UK consumer and is being augmented by intelligent acquisitions of brands like Fat Face.

“With inflation falling and wages rising, the economic picture also looks a lot less bleak than at the start of last year.”

Shares in Next leapt by more than 5% in early trading on Thursday following the trading update.

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M&S tech chief leaves months after cyber attack cost it £300m

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M&S tech chief leaves months after cyber attack cost it £300m

The Marks & Spencer (M&S) executive responsible for its technology function is leaving the retailer months after a devastating cyber attack which disrupted its systems at a cost of hundreds of millions of pounds.

Sky News has learnt that Rachel Higham, M&S‘s chief digital and technology officer, is leaving the company.

A former WPP and BT Group executive, Ms Higham was hired by M&S early last year.

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Her departure was announced in an internal memo circulated on Thursday.

In it, the company said she was “stepping back from her role”.

“Rachel has been a steady hand and calm head at an extraordinary time for the business, and we wish her well for the future”.

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The April cyber attack on M&S, which was conducted by a group called Scattered Spider, brought its online operations to a halt, underlining the growing threat posed by such incidents.

Its click-and-collect service is now back up and running, and the retailer expects part of its costs to be covered by insurance.

M&S said early last month that it was not looking to replace Ms Higham following an enquiry from Sky News.

It was unclear who would succeed her in the role or whether she would be eligible for a payoff.

An M&S spokeswoman confirmed on Thursday that the memo was genuine but refused to comment further.

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Supermarket spreadable matches Lurpak in taste test | Sign up to Money newsletter

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Supermarket spreadable matches Lurpak in taste test | Sign up to Money newsletter

Sky News has launched a free Money newsletter – bringing the kind of content you enjoy in the Money blog directly to your inbox.

Each Friday, subscribers get exclusive money-saving tips and features from the team behind the award-winning Money blog, which is read by millions of Britons every month.

Sign up today, and this week you’ll find the following in the newsletter:

  • The free £2,000 that 800,000 parents aren’t claiming
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  • And we outline the best deals available in five key areas for your household budget

So join our growing Money community – and thanks to the thousands of you who already have.

What to expect each week

The newsletter is your essential personal finance companion, with digestible information to help you make smarter decisions on your savings, mortgages, holiday money and much more.

As a subscriber, you get additional exclusive content that goes beyond the blog.

At a time when the global economy faces so much uncertainty, we have analysis from our trusted economics teams on the big stories that affect the cash in your pocket.

You also get first looks at popular features such as Money Problem, Cheap Eats, What It’s Really Like To Be A and our weekend Long Read.

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John Lewis blames budget tax hikes for deeper loss

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John Lewis blames budget tax hikes for deeper loss

The John Lewis Partnership (JLP) has blamed budget tax hikes for a deeper half-year loss.

The UK’s largest employee-owned business, which owns John Lewis department stores and Waitrose supermarkets, reported a headline loss before tax and exceptional items of £34m for the six months to 26 July.

That compared to a £5m loss in the same period last year. The higher figure was reached despite a 4% rise in group sales to £6.2bn.

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“This result was significantly impacted by costs not present in the equivalent prior period”, the partnership explained, “including £29m of costs for the new Extended Producer Responsibility (EPR) packaging levy (where we took the full annual cost in our first half results), alongside higher National Insurance Contributions (NICs)”.

JLP said the loss figure also reflected additional investment in its systems and growth-led teams.

On a bottom line basis, the losses stood at £88m – up from £30m – as some exceptional costs associated with the group’s turnaround and some non-cash impairments were included.

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JLP insisted it was on track to grow profitability in the core second half of its financial year, despite a “challenging” macroeconomic environment, as both operations were outperforming in their respective markets.

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The company cited benefits from its investment, which hit £191m over the six months, have been prioritised over partner bonuses during several years of recovery for the group that have seen underperforming department stores closed and jobs lost.

Jason Tarry, the former Tesco executive who has chaired the partnership for a year, said the outlook was positive despite consumer confidence remaining subdued.

“Our clear focus on accelerating investment in our customers and our brands is working: more customers are shopping with us, driving sales, and helping Waitrose and John Lewis outperform their markets”, he said.

“We achieved our highest recorded levels of positive customer satisfaction, a testament to the great service of our partners.

“The investments we are making, combined with our plans for peak trading, provide a strong foundation for the remainder of the year.

“While we are reporting a loss in the first half, we’re well positioned to deliver full-year profit growth, which we’ll continue to invest in our customers and partners.”

Market analysts have cautioned that the sales figures are likely to have been flattered by the disruption to trading at rival M&S, which suffered a cyber attack in April.

But Robyn Duffy, consumer markets senior analyst at RSM UK, said of the sales uplift: “Waitrose’s performance has been a key driver, benefiting from a renewed focus on its food proposition, including a greater emphasis on lower prices and a more effective adoption of technology to improve the customer experience.

“Meanwhile, the John Lewis retail arm is successfully drawing in customers through a combination of revitalised physical stores, a focus on meaningful brand partnerships, and the reintroduction of its Never Knowingly Undersold price matching strategy.”

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