Emer MoreauBusiness reporter
Fashion and homeware chain Next is to raise prices by up to 8% in some countries outside Europe as it anticipates millions of pounds in extra costs from the US-Israel war with Iran.
The retailer said it is facing an additional £47m in costs this year due to higher fuel prices and disruption to global supply chains from the Middle East conflict.
It said it would look to hike prices in some international countries from May, but said efforts to make cost savings would mean it does not need to push through extra price increases in the UK and Europe.
Its forecast is based on the assumption that fuel costs remain around their current level, and supply chain issues neither worsen nor improve.
Next had initially anticipated additional costs of £15m due to the war, but that only covered the first three months after the US and Israel first launched attacks on Iran.
Next increased its full-year profit forecast to £1.22bn, from £1.21bn, after full-price sales increased over its first quarter by 6.2%.
UK sales rose 4.4%, which was better than expected.
The company said that increased costs in the UK will be offset by “cost savings and margin gains” through better factory-gate prices.
It is not expecting to raise UK prices by more than the 0.6% it forecast at the beginning of the year.
In Europe, “cost increases have been offset by currency gains, so there is no need for price increases”.
“Price increases outside Europe will vary by country, but will be no more than +8% in any territory,” it added.
The group forecast full price sales growth of 5.0% for the full year.
Shares in Next are down 5% so far this year.