Next hit by slump as rivals catch up

SHARES in Next fell 5pc after it warned rival chains had finally caught up by improving their online experience for shoppers.

Britain’s second largest clothing retailer, the first to issue an update for the crucial festive period, also blamed lacklustre sales on the weather and not having enough stock.

The unusually gloomy statement from Next, which is seen as a bellwether for the state of the High Street, dragged down main competitor Marks & Spencer’s shares by nearly 1pc. M&S is also expected to disappoint when it issues its festive update tomorrow.

The unseasonal autumn weather has been a drag on most of the main shopping chains who have been left with coats and winter woollies on their shelves.

Next chief executive Lord Wolfson said sales at its 500 UK shops fell by 0.5pc between October 26 and December 24 due mainly to the mild temperature. Its Next Directory business, which includes its catalogue and website, saw sales increase 2pc.

The total sales for the period, combining UK shops and Directory, only rose 0.4pc.

But what spooked the market, sending the shares down 330p to 6860p, was that Next flagged a more serious concern about the strength of its rivals.

Three years ago Next was rare in offering next day delivery but this has now become the norm with Amazon, ASOS and John Lewis all providing this, and even faster delivery. Next had previously issued guidance that annual profits would be between £810m to £845m but has now lowered that forecast to around £817m.