Next - announces acquisition of FatFace
Summary
Next stated that the acquisition would not materially impact its underlying pre-tax profit or earnings per share (EPS) guidance for the current year. Successfully keeping full-priced sales front and centre to avoid discounts is one of the main reasons Next boasts some of the best margins in the sector. The online division accounts for more than 50% of group sales, and were pleased to see that increased warehouse space and operational tweaks are helping to iron out some of the problems of the past. Its still a relatively small slice of the pie at the moment, but overseas markets offer huge growth potential and its an exciting prospect if Next can execute well here. And despite multiple guidance upgrades, full-year pre-tax profits are expected to be broadly flat year-on-year, highlighting just how tough the retail sector can be in times of economic uncertainty.