Next has raised its annual profit forecast again after sales during its first quarter beat the retail chain’s expectations by £75m as coronavirus lockdowns eased.

The fashion-to-furnishings firm reported a 1.5% decline in full price sales in the thirteen weeks to 1 May compared to the same period two years ago – before the COVID-19 pandemic forced doors to periodically close.

The chain’s earlier guidance had assumed a fall of 10% given uncertainty over the timing of reopening for stores.

Next said that as a result of the performance, it had raised its guidance for full year profit before tax – for the second time in as many months.

It was increased by £20m to £720m thanks mainly to the darling of its operation, online.

But, crucially, the company added that its previous prediction of sales guidance, a rise of 3% against two years ago, remained in place as it expected pent-up demand to diminish.

Next said sales had been “exceptionally strong” over the past three weeks as physical stores reopened.

It reported that, versus two years ago, total full price sales were up +19% in the period with like-for-like full price sales in stores up 2%.

Online sales were up 52%, the company said.

The update adds to evidence of strong demand on the high street since so-called ‘non-essential’ retail was allowed to open its doors again following a horrific year for the sector that has resulted in a string of big name casualties, including Sir Philip Green’s Topshop empire and Debenhams.

Primark has been among Next’s rivals reporting “record” sales while another, Superdry, said on Thursday it had returned to growth in the final quarter of its own financial year.

The fashion chain said online and wholesale accounted for the recovery after pandemic disruption resulted in sales for the year to 24 April falling 21% to £557m.

Chief executive Julian Dunkerton said: “The early signs following the reopening of our UK stores are encouraging, as lockdown restrictions start to lift, and we can clearly see the light at the end of the tunnel.”

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