Next’s chief exec has warned that the consumer environment will “remain subdued”.
Lord Wolfson’s comments come as the retail giant, which has 541 stores nationwide, posted its financial figures for the second quarter of 2013 where it announced a nine percent rise in profits.
Figures jumped to £621.6 million and revenues from its online business increased by 9.5 percent to £1.2 billion.
However, despite hoping to increase profits to £665 million this year, Lord Wolfson said the economy was still difficult and it would take time for the nation to work its way back to “affording the lifestyle it was already enjoying before the financial crisis”.
The Chief’s comments contrast to a recent report by the Office of National Statistics (ONS), which found that retail takings grew by 1.8 percent in February after a slow start to 2013, which was blamed on the bad weather.
Department stores saw a 10.6 percent sales increase in February – the biggest monthly rise since last April driven by computer equipment and jewellery.
However, Next has yet to see the benefits with Wolfson claiming the company’s earnings were running below the rate of inflation. He said this decline in real earnings looked set to continue for at least one, if not several more years.
“Indeed the outlook for 2013 inflation has worsened since this time last year,” he said.
He also admitted that the company’s present sales were at the bottom of its target range, although it hoped for improvement once it gained a better understanding of the underlying consumer environment once temperatures returned to seasonal levels.
However, his tame words in the financial statement were in contrast to his comments in The Guardian, where he laid into “incompetent” local councils for the state of the high street.
He said some high streets had been neglected for 20 to 30 years as a result of councils resistant to change, meaning there were many towns and cities where the stock of shops was inadequate.
