Next PLC shares rose early Thursday after the retailer provided upgraded profit and sales guidance for the new financial year.

The Leicester-based clothing and homewares seller reported a 10% increase in pretax profit to £1.01 billion in the financial year ended January 25 from £918 million the year prior.

Shares in Next were up 6.4% at 10,620.00 pence on Thursday morning in London, the best performer in the FTSE 100 index.

Driving the profit improvement was growth in sales, boosting revenue by 11% to £6.12 billion from £5.49 billion. Divisionally, both Online (UK) and Finance reported sales growth, while Retail experienced a slight decline.

Online (UK) sales advanced 4.5% to £2.54 billion from £2.43 billion, while Finance improved 2.4% to £300 million from £293 million. By contrast, Retail sales edged down by 0.9% to £1.85 billion from £1.87 billion. Retail represents Next’s bricks-and-mortar stores, while Finance is its consumer credit offering.

Next proposed a final dividend per share of 158 pence, up 12% on the prior year’s 141p. This brought the total dividend up by 13% for financial 2025 to 233p from 207p.

Looking at its new financial year, Next said the first eight weeks of trading have surpassed its expectations, upgrading its first-half full price sales growth guidance to 6.5% from 3.5%. For the full-year, it expects 5.0% growth, up from 3.5%.

Next said it wouldn’t upgrade second-half guidance owing to a strong prior year comparator. It also expects incoming UK tax rises in April to ‘weaken the UK employment market and negatively impact consumer confidence as the year progresses’.

In the UK government’s October budget, Chancellor Rachel Reeves increased employers’ national insurance contributions to 15% and raised the UK National Living Wage to £12.21 per hour, with these policies set to take effect on Tuesday.

Next also raised its pretax profit guidance for the full-year by £20 million to £1.07 billion. This would represent a 5.4% uplift from financial 2025. However, again Next noted that cost increases associated with wage cost inflation and the national insurance increase are anticipated to raise costs by £67 million.

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