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Next retailer to issue profit warning sending a chill around the city


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Old 04-01-2017, 09:53
trevgo
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But the FTSE has reached a record high.
And we know full well why that is. It has been reported repeatedly. It has no bearing on the health of the UK economy whatsoever - purely inflated £ profits by large companies trading in $. Measured in USD, the FTSE is 5% lower than it was before the Brexit vote.
I have never set foot in a Next outlet and don't know anyone who has.
That says more about you and your circle than the millions who do shop at Next. I thought remainers were the ones who were out of touch.....
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Old 04-01-2017, 09:55
Annsyre
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Is this a serious question? Do you really not understand the impact of the plummeting pound following Brexit vote on Business.
Unlike so many self-certificated experts on the economy on this forum I have no expertise in economics.

I do know that in periods of uncertainty currencies do badly and then recover.

The impact of a weaker Sterling is certainly continuing to play a positive role for UK industry with it being reported that new export business rose for the seventh successive month in December.

British companies reported increased levels of new work from the USA, Europe, China, Middle East, India and other Asian markets.

"This growth in new order inflows was the strongest in two-and-a-half years. In response, employment levels gathered pace at the fastest rate for 14 months, where SMEs saw the biggest rises in staffing," says David Noble, Group CEO at the CIPS.
.

https://www.poundsterlinglive.com/gb...mis-in-january
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Old 04-01-2017, 10:02
jonmorris
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The first taste of 2017.

The false glee of 2016 will be wiped off the smirking Brexit faces very quickly. We're in for a horrible time.
Not going to happen. Brexit supporters have a coping mechanism that means they'll argue we didn't need a company like Next anyway and continue to say how there's no connection and all will be well.

Already I'm reading comments about the possibility of a return to high roaming charges in Europe as being no bad thing, because when you're on holiday you shouldn't be using your phone anyway.

So everything bad that happens now which can be linked to Brexit is being treated as not a big deal.
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Old 04-01-2017, 10:19
Rastus Pieface
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But someone has to pay and make up for that loss, and it's not going to be the executives.
it's an upper end forecast.

That is £25M they may well not be investing in refurbishing, expansion, new stores, more staff.

That's a 3% contraction - any idea what the result of an equivalent contraction in the economy produces?

Usual numbskull attitude - it's like banging one's head against a brick wall.
it's an upper end forecast. read the article, before frothing at the mouth and clutching your pearls.

I don't think you understand quite how things like this affect the economy as a whole.
it's an upper end forecast.

did you read the article?
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Old 04-01-2017, 10:21
TheEngineer
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it's an upper end forecast.



it's an upper end forecast. read the article, before frothing at the mouth and clutching your pearls.



it's an upper end forecast.

did you read the article?
So if they have reduced their forecast then this will affect forward planning for spending on store refurbishments, new stores etc which will have a knock on effect to the companies that do the work for them
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Old 04-01-2017, 10:39
ShaunIOW
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But someone has to pay and make up for that loss, and it's not going to be the executives.
But it's not a loss is it, how can you lose something you never had in the first place? Especially when it's just a guess at what you'll get, the company is still making a huge profit, and the share prices like the currency markets are just greedy gits gambling.
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Old 04-01-2017, 10:45
Annsyre
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And we know full well why that is. It has been reported repeatedly. It has no bearing on the health of the UK economy whatsoever - purely inflated £ profits by large companies trading in $. Measured in USD, the FTSE is 5% lower than it was before the Brexit vote.


That says more about you and your circle than the millions who do shop at Next. I thought remainers were the ones who were out of touch.....
Persisting in calling people names is rather childish.

My circle? How silly.
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Old 04-01-2017, 10:47
jmclaugh
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Sales down 0.4% in the run up to Xmas and the annual profit forecast has been revised to £792m which is at the lower end of the previous guidance issued by Next of £785m-£825m. Hardly a disaster except for some of our resident Bremainers.
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Old 04-01-2017, 11:02
trevgo
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Persisting in calling people names is rather childish.

My circle? How silly.
It was you who sniffily said you'd never set foot in Next, and didn't know anyone who did, as if it wasn't worthy.

I would respectfully suggest that the reason you have never done so is because Next caters for a younger demographic than yourself. Or are you and your young trendy cohorts more discerning and patronise The Kooples or the Diesel shop?

I actually did buy a sweater and 3 shirts from Next between Christmas and New Year (and am a good deal older than most of their clientele seeing as I refuse to grow old gracefully!) and it was noticeable how few people were in there - and in general - in Westfield. No queues anywhere - not even outside the Hollister shop, which much be a first.
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Old 04-01-2017, 11:03
NilSatisOptimum
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Not something the city wants to hear. Next retailer to issue profit warning of 14%.
Sterling troubles playing a big part and household inflation playing its part too.
CEO calling for no hard Brexit.

This is another warning to the May administration.

https://www.google.ie/url?sa=t&sourc...GW_k38PRhtU-xw
Lord Woflson CEO of Next, sounds like an expert, what does he know. Democracy Democracy Democracy.
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Old 04-01-2017, 11:16
Rastus Pieface
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So if they have reduced their forecast then this will affect forward planning for spending on store refurbishments, new stores etc which will have a knock on effect to the companies that do the work for them
er, their UPPER END FORECAST, not forecast. as for spending on store re-furbishment, i am sure they can afford it if they only make 825 million quid profit, instead of 845 million quid profit.

unless those profits are going somewhere else.

https://www.theguardian.com/business...misses-targets
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Old 04-01-2017, 11:23
trevgo
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Lord Woflson CEO of Next, sounds like an expert, what does he know. Democracy Democracy Democracy.
Well, he was a loud Brexiter, so is one businessman with whom I have zero sympathy.
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Old 04-01-2017, 11:25
Mark_Jones9
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Not something the city wants to hear. Next retailer to issue profit warning of 14%.
Sterling troubles playing a big part and household inflation playing its part too.
CEO calling for no hard Brexit.

This is another warning to the May administration.

https://www.google.ie/url?sa=t&sourc...GW_k38PRhtU-xw
According to Next trading statement

OUTLOOK FOR THE YEAR AHEAD

The fact that sales continued to decline in quarter four, beyond the anniversary of the start of the slowdown in November 2015, means that we expect the cyclical slow-down in spending on clothing and footwear to continue into next year.

In addition to this effect, there are two further factors which may depress sales:
 We may see a further squeeze in general spending as inflation begins to erode real earnings growth.
 As previously indicated, following the devaluation of the Pound, we expect prices on like-for like garments to rise, but by no more than 5%. We expect that this will depress sales revenue by around 0.5%.

Overseas sales will be boosted by the devaluation of the Pound which means that we expect total reported full price sales to be around +1% better than the constant currency numbers detailed above

In the year ahead we face a number of inflationary pressures in our cost base. The National Living Wage, the national business rates revaluation, Apprenticeship Levy and energy taxes will add around £13m to our cost base. General inflation in wages and other non-product costs look set to increase by an additional £6m. In addition we intend to add around £10m to our cost base in order to improve our website systems and online marketing.
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Old 04-01-2017, 11:31
thirstyelephant
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Indeed, and what will happen is that the Brexit zealots on here will either "disappear", register with a new username or blame anyone and everyone but themselves for what happens.
I don't blame anyone who voted Brexit or Bremain. Everyone had personal reasons for voting the way they did.

Who I do blame is David Cameron for playing party politics with a serious issue such as this for his own personal gain despite knowing what would happen should we leave. His own arrogance is what has led us here and he didn't even have the balls to stick it out. He ran away to hide like a little child.

If Bremainers what to blame anyone that's your man.
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Old 04-01-2017, 11:35
trevgo
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If Bremainers what to blame anyone that's your man.
Cameron's guilt in this charade is well established.

Doesn't let the idiot politicians who ran the Leave campaign, and the gullible who fell for it, off the hook one bit.
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Old 04-01-2017, 11:36
moox
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I feel sorry for the Next rank and file staff whose jobs will look slightly less certain.

But I can't help but smile with glee that their pro-Brexit CEO now has to feel some of the repercussions of his moronic views
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Old 04-01-2017, 11:43
Emyj74
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Can someone point out where this all down to brexit which of course has not happened yet?

Seems to be a case of when any retailer struggles people will blame brexit?
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Old 04-01-2017, 11:43
Jayceef1
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I feel sorry for the Next rank and file staff whose jobs will look slightly less certain.

But I can't help but smile with glee that their pro-Brexit CEO now has to feel some of the repercussions of his moronic views
Your having a laugh. Jobs uncertain because only making £800 million profit. Give over.
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Old 04-01-2017, 11:46
trevgo
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Your having a laugh. Jobs uncertain because only making £800 million profit. Give over.
If business and profits down, there will be less staff. It's how business works. Something Brexiters are going to learn the hard way.
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Old 04-01-2017, 11:48
moox
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Your having a laugh. Jobs uncertain because only making £800 million profit. Give over.
Speaking as someone who was made redundant from a megacorp, due to a mass layoff that was started because we only made 95% of the profit we made the year before, which was still in the billions of dollars... no thanks

(and I was a person who had considerably more staying power than the average retail employee)
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Old 04-01-2017, 11:50
jmclaugh
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If business and profits down, there will be less staff. It's how business works. Something Brexiters are going to learn the hard way.
By all means point out where Next have said they plan to reduce staff levels due to a profit forecast of £795m which is within the range they were expecting of £785-£825m.
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Old 04-01-2017, 11:56
Jayceef1
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According to Next trading statement

OUTLOOK FOR THE YEAR AHEAD

The fact that sales continued to decline in quarter four, beyond the anniversary of the start of the slowdown in November 2015, means that we expect the cyclical slow-down in spending on clothing and footwear to continue into next year.

In addition to this effect, there are two further factors which may depress sales:
 We may see a further squeeze in general spending as inflation begins to erode real earnings growth.
 As previously indicated, following the devaluation of the Pound, we expect prices on like-for like garments to rise, but by no more than 5%. We expect that this will depress sales revenue by around 0.5%.

Overseas sales will be boosted by the devaluation of the Pound which means that we expect total reported full price sales to be around +1% better than the constant currency numbers detailed above

In the year ahead we face a number of inflationary pressures in our cost base. The National Living Wage, the national business rates revaluation, Apprenticeship Levy and energy taxes will add around £13m to our cost base. General inflation in wages and other non-product costs look set to increase by an additional £6m. In addition we intend to add around £10m to our cost base in order to improve our website systems and online marketing.
So the fall in Sterling will depress sales by 0.5% in the UK but will boost overseas sales to give an overall benefit of 1%. Therefore NONE of this forecasted fall in profit is down to Brexit but the other items on the list such as the National Living Wage taxes and the 40% of the forecast reduction on upgrading their website system.
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Old 04-01-2017, 11:59
RecordPlayer
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When I traipsed round the shops before Christmas - Next was practically empty, whereas shops like Zara, Mango and H&M were packed. I've no idea why, because Next clothes weren't more expensive than in the other shops. Maybe the designs are better in the other shops?
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Old 04-01-2017, 12:01
Jayceef1
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Speaking as someone who was made redundant from a megacorp, due to a mass layoff that was started because we only made 95% of the profit we made the year before, which was still in the billions of dollars... no thanks

(and I was a person who had considerably more staying power than the average retail employee)
But they have not said they will cut jobs. I too have been made redundant from large companies. It happens for various reasons but not in this case.
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Old 04-01-2017, 12:02
moox
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But they have not said they will cut jobs. I too have been made redundant from large companies. It happens for various reasons but not in this case.
Well yeah, they'll say no job cuts.... until 5 minutes before they make job cuts. If that's what is needed to take the share price back up.

But I did originally say "slightly less certain", meaning that there may not be job losses, it just makes it a bit more likely.
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