Next takes advantage of the death of the high street

A branch of clothing retailer Next is seen in London, Britain September 30, 2014. REUTERS / Andrew Winning

LONDON, July 21 (Reuters Breakingviews) – Next (NXT.L) is reaping the rewards of its neighbors’ collapse. Shares of the £ 11bn retailer rose 10% on Wednesday after raising its pre-tax profit forecast for 2021 from £ 30m to £ 750m. This was helped by a 19% increase in sales in the 11 weeks leading up to July 17 compared to the same period before the pandemic in 2019.

The main street narrowing is working well for Next Chief Executive Simon Wolfson, whose company has proven to be more resilient than its UK peers as more than half of its sales were online even before the pandemic. Department stores Debenhams and Arcadia, owner of Topshop, have collapsed and Gap (GPS.N) is closing its UK stores. Next is valued at 15 times the profits of 2022, according to Refinitiv. It’s a discount from its European peers, where the retail industry has been less affected by online sales. H&M (HMb.ST), for example, is currently valued at a multiple of 18 times. The disappearance of his rivals will help Wolfson close the valuation gap. (By Aimée Donnellan)

On Twitter

Capital Calls – More Concise Information About Global Finance:

Game failure leaves Ubisoft stuck on a buyback shelf Read More

Bridgepoint IPO shows rare private equity largesse read more

HKEX hoists welcome the typhoon signal Read more

BBQGuys goes easy on the hot sauce read more

Apollo Can Help Fortress Head To Morrisons Until Learn More

Editing by Neil Unmack and Oliver Taslic

Reuters Breakingviews is the world’s leading source for agenda-setting financial information. As the Reuters brand for financial commentary, we dissect big business and economic stories from around the world every day. A global team of around 30 correspondents in New York, London, Hong Kong and other major cities provide real-time expert analysis.

Sign up for a free trial of our full service at and follow us on Twitter @Breakingviews and at All opinions expressed are those of the authors.

About Nunnally Maurice

Check Also

Britain’s Next buys bankrupt furniture retailer, 400 jobs cut goes into administration this Wednesday Next buys brand, website and intellectual property for 3.4 …

Leave a Reply

Your email address will not be published.