Results round-up

Next trimmed its full year sales and profits guidance after sales fell in the first quarter of its financial year.

Full price sales for the 13 weeks to 29 April slipped 3.0%, worse than the market’s expectation of a 2% decline as retail sales tumbled 8.1% but Directory sales from the website and catalogue rose 3.3% in what management expect to be the weakest quarter of the year.

Earlier in the year Next admitted that its product range had fallen out of sync with its "heartland" customers, while its stores were being hit by a more challenging consumer environment and structural changes in the retail market.

Sales in February were weaker than those in March and April, with the difference attributed to the later, warmer Easter this year.

On guidance, Next now expects full year sales in the range of -3.5% to +0.5%, with the upper end cut from +2.5% at the time of its full year results.

Profit before tax is now seen coming in at £680-740m, with the top end cut from £740m, meaning at best they will fall 6.4% from last year or at worst by 13.9%.

As stated at its March full year results, Next expects to get the benefit of improvements in its product range from the autumn onwards, but warned that “the UK consumer environment remains challenging, particularly in the clothing and homeware markets, and real wage growth is now close to zero”.

Cash flow was said to remain strong but was at the lower end of the guidance range, with expectations of £255m of surplus cash to be generated for the full year after deducting interest, tax, capital expenditure and ordinary dividends.

Royal Dutch Shell's net income rose across almost all its main units at the start of the year thanks to the rebound in oil prices, with the company touting how its cash dividend was fully covered for a third consecutive quarter.

The company's net income jumped more than sixfold during the first three months of the year to reach $3.54bn, alongside a sharp improvement in its cash flows from operations which rose from $661.0m one year ago to hit $9.51bn.

On a current cost of supplies basis, and excluding identified items, earnings were 142% higher versus a year ago to $3.8bn.
Earnings per share came in at 43 US cents, versus 7 cents one year ago.

Free cash flow improved from -$16.3bn in the comparable year-ago period to $5.2bn during the first quarter, but was lower than the $5.74bn achieved during the first quarter.

Commenting on the results, chief Ben van Beurden highlighted the company's improved cash flows, which allowed the oil major to cut debt and cover its cash dividend for a third consecutive quarter, together with the better market conditions in its Upstream and Chemicals segments.