Next boss Wolfson defies gloom to cheer City

NEXT boss Simon Wolfson is cool as a cucumber. While other retailers flap, cry in anguish and desperately search for costs to cut, he sits seemingly above the fray.

The consensus has been that only niche or high-end retailers can presently flourish in the face of Amazon et al, but Next is about as middle-brow and middle of the road as it comes.

Today he unveiled another set of results that defied gloomy forecasts.

The broker Peel Hunt wrote: “Next has outperformed expectations, despite the impact of Lockdown 2, Tier 4 and now Lockdown 3. Group sales were up year on year for six out of nine weeks over peak trading, with online revenues offsetting store declines. Central guidance for the year ahead is 4-5% above market expectations after assuming stores stay closed until the end of March. Once again, this shows the relevance of the brand and Next platform to UK households.”

Indeed, Lord Wolfson felt confident enough to say that most staff will keep their jobs despite the pandemic, as he reported booming online sales that saw the shares jump 8%.

The fashion house, regarded as one of the best run businesses in Britain, is one of the clear Christmas retail winners with sales in the nine weeks to Boxing Day just 1.1% lower than they were in 2019.

That was far better than it or the City expected. Sales in stores tumbled 43%, but online sales jumped 36%.

Wolfson, the CEO, predicts profits for the year of £670 million, an estimate which assumes stores will be closed in February and March. Unless those forecasts prove “wildly wrong”, most of his 27,000 staff will stay employed.

“We anticipate a small number of redundancies, but we have been very conservative”, he said.

He also backed the high street, saying most of the 500 stores will re-open with Next renegotiating shop lease prices but embracing their “legal commitment” to landlords.

Wolfson, a Tory party donor and Brexiteer, refused to criticise government Covid policy.

He said: “You could find any number of analysts who don’t understand the pandemic criticising government policy, I am not going to be one of them.”

Brexit, said Next, has made no difference and will have “no material impact on our ability to import and export stock”.

The shares rose 580p to 7495p.

Next has saved some money from suspending dividend payments. Balance sheet debt tumbled by £487 million to £625 million.