Final Results

Next PLC 27 March 2003 Date: Embargoed until 07.00am: Thursday 27 March 2003 Contacts: Simon Wolfson, Chief Executive David Keens, Group Finance Director NEXT PLC Tel: 020 7796 4133 (27/03/2003) Tel: 0116 286 6411 (thereafter) Alistair Mackinnon-Musson Philip Dennis Hudson Sandler Tel: 020 7796 4133 Email: next@hspr.co.uk Photographs available: http://www.next.co.uk/press/ (or Hudson Sandler, as above) NEXT PLC RESULTS FOR THE YEAR TO JANUARY 2003 * Turnover up 18% to Â£2,202m * Profit before tax up 13% to Â£301m * Earnings per share up 18% to 68.7p * Post tax return on capital employed increased to 51% * Total dividend increased by 13% to 31p David Jones CBE, Chairman, said: 'I am pleased to report that NEXT continued to make good progress in the year ended January 2003. Earnings per share rose by 18% to 68.7p and were enhanced by the beneficial effect of the share buybacks in the last two years. Post tax return on capital employed increased to 51%. The Board is recommending a final dividend of 21p making a total of 31p for the year, an increase of 12.7%. Dividend cover rises to 2.2 times. Our ability to generate cash enables us to continue to buy back our shares when it is in the interests of our shareholders. This is an important part of our aim to deliver long term growth in earnings per share.' CHAIRMAN'S STATEMENT I am pleased to report that NEXT continued to make good progress in the year ended January 2003. Earnings per share rose by 18% to 68.7p and were enhanced by the beneficial effect of the share buybacks in the last two years. Post tax return on capital employed increased to 51%. The Board is recommending a final dividend of 21p making a total of 31p for the year, an increase of 12.7%. Dividend cover rises to 2.2 times. My change of role within NEXT has given me the time and opportunity to take a step back from the day to day operations and review our corporate strategy. Since the early 1990's we have resisted all attempts to increase the number of clothing brands that we operate because we were convinced that diversification would ultimately be to the detriment of the NEXT Brand. The success that we have achieved over many years as a result of product development, the progressive move to larger stores and the increase in the number of Home Shopping customers convinces us that it is right to continue with this strategy. NEXT Retail is our most 'visible' business, but no-one should overlook the NEXT Directory which now has a turnover of almost Â£500m and is one of the few really profitable home shopping companies in the UK. Our ability to generate cash enables us to continue to buy back our shares when it is in the interests of our shareholders. This is an important part of our aim to deliver long term growth in earnings per share. I believe that the success of NEXT is due to four main factors: â€¢ Our focus on providing our customers with the product they want. â€¢ The strength and skills of a good, well motivated management team that is honest to recognise its mistakes and quick to put them right. â€¢ The support of our suppliers with whom we work in partnership to achieve good quality and value for money products. And above all: â€¢ The enthusiasm and dedication of all our employees who take great pride in the success of their company. I would like to thank them all for their contribution to another successful year. David Jones CBE Chairman 27 March 2003 CHIEF EXECUTIVE'S REVIEW INTRODUCTION In the year ended January 2003 Group turnover was Â£2,202.6m, 18% ahead of the previous year. Sales in NEXT Retail were up 16%. NEXT Directory had a particularly good year with sales up 30%. The year consisted of 53 weeks for NEXT Retail and Directory, compared with 52 weeks last year. This accounts for 1.6% of Retail sales growth and 2.7% of Directory sales growth. On a comparable basis Retail like-for-like sales increased by 3.3%. The NEXT Brand profit will have benefited by approximately Â£5m as a result of the extra week this year. The operating profit before interest and taxation increased by 17%. The share buyback programme had two significant effects on our profit and loss account: â€¢ An increased interest charge meant that profits after tax increased by 11%. â€¢ Earnings per share grew by 18% (ahead of the increase in operating profit despite an increased tax charge) due to the reduced number of shares in issue. A more detailed explanation of the rationale and effects of the share buyback programme are given in a later section. PROFIT AND LOSS ACCOUNT Turnover and profit figures are set out in the table below: Turnover Profit Excluding VAT Before Tax 2003 2002 2003 2002 Â£m Â£m Â£m Â£m NEXT Retail 1,579.7 1,359.7 213.9 188.2 NEXT Directory 471.7 362.2 65.1 49.2 ______ ______ ______ ______ The NEXT Brand 2,051.4 1,721.9 279.0 237.4 NEXT Franchise 22.7 19.1 4.4 3.7 Ventura 97.4 101.9 11.2 13.0 Other Activities 31.1 28.8 15.1 12.5 ESOP Charge (8.2) (8.0) ______ ______ ______ ______ Turnover & Operating Profit 2,202.6 1,871.7 301.5 258.6 +17% ______ ______ Interest (Expense)/Income (0.3) 7.2 ______ ______ Profit before Tax 301.2 265.8 Taxation (90.7) (76.0) ______ ______ Profit after Tax 210.5 189.8 +11% ______ ______ Earnings per Share 68.7p 58.1p +18% STATEMENT OF FINANCIAL OBJECTIVE The financial objective of the Group is to maximise sustainable long-term growth in earnings per share. Over the last five years earnings per share have grown by 86%. We aim to grow EPS by: â€¢ Continuing to advance the underlying operating profit of the NEXT Group. This will mainly be achieved through the development of product ranges, expansion of our selling space and the growth of our home shopping business. â€¢ Continuing to enhance growth in EPS through the buying back of our shares for cancellation as and when it is in the interests of our shareholders generally. THE DEVELOPMENT OF THE NEXT BRAND Improving style, quality and value The style, quality and value of our ranges remains our highest priority. We believe that it is the product that makes the brand successful, not vice versa. We will continue to pass on the benefits of better buying, by offering the same quality product at lower prices or a better product at the same price. This effort will remain at the heart of our business going forward. Autumn Winter 2002 selection issues During the Autumn it became apparent that some of the Womenswear ranges were too narrowly focussed and had some important omissions. As a result we reviewed selection procedures in order to ensure that future ranges were better balanced. We were unable to make any significant improvements to these ranges before Christmas, but have been able to make improvements to the spring and summer ranges. We believe the benefits of these changes will become more apparent as the season progresses. New product development We continue to develop and expand our product ranges where we believe an understanding of our customers, combined with our design skills, can genuinely add value. We have made good progress this year in the following new and developing areas: Lingerie, Maternity, Bodycare, Gifts, Kitchen, Bathroom, Skiwear and Fresh Flowers. Whilst these new areas are exciting, we anticipate that the majority of our growth will still come from the development of our core clothing and home ranges. THE DEVELOPMENT OF NEXT RETAIL Rationale for space expansion Our most important objective in NEXT Retail is to profitably expand our selling space. We believe that new space will continue to make a contribution to the growth of sales and profits in the years ahead, because it enables us to offer our customers a greater choice of product in a more comfortable shopping environment. The drive for new space is governed by strict financial criteria. Every new store aims to pay back the net capital invested in less than 24 months and to achieve at least 15% store profit on sales before distribution and central costs. When appraising new stores we do not factor in any future like-for-like growth, the store must achieve its investment criteria on the basis of its expected first year sales. Performance of new space This year our space expansion programme has been particularly successful. The portfolio of new space is exceeding its appraised sales target by 14% and will pay back the net capital invested in 12 months. Profile of new space During the year we added a net 357,000 square feet to our trading space, increasing the total by 18% to 2,338,000 square feet. The table below shows how the shape of our portfolio has changed over the last three years. Store Size Number of Stores % of Selling Space (square feet) 2003 2002 2001 2003 2002 2001 Less than 5,000 182 198 225 23% 29% 38% 5,000-10,000 96 86 81 29% 30% 34% 10,000-15,000 34 22 16 18% 14% 12% 15,000-20,000 19 14 10 14% 12% 10% Greater than 20,000 13 11 4 16% 15% 6% TOTAL 344 331 336 Impact on like-for-like sales When appraising new stores we take into account the estimated lost sales and lost profit resulting from any impact on nearby stores. For example when we appraised a new out of town store near Bedford we estimated a reduction in turnover in the Bedford town centre store. As expected there has been a significant downturn in the original store, but it still makes more than 20% store profit and will therefore remain trading. Retail companies define like-for-like sales in different ways. NEXT includes all stores that have traded for at least one full year and that have not benefited from capital expenditure amounting to more than 2% of their annual turnover. Inevitably this includes all those stores that have been affected by new openings. We have never made adjustments for deflected sales when stating our like-for-like sales. Therefore, the addition of new space reduces our stated like-for-like sales and we estimate that the effect of this attrition last year was 1%. The Year Ahead We currently expect to increase net selling space by at least 400,000 square feet in the year ahead. THE DEVELOPMENT OF NEXT DIRECTORY Our two main objectives in NEXT Directory are to: â€¢ Increase the number of people using the Directory by increasing our customer base. â€¢ Increase the breadth of offer available to order from home through increasing the number of pages. Growing the customer base The growth in new customers has made the most significant contribution to the growth of sales in our home shopping division. During the year we made good progress and start the new year with 22% more customers than a year ago. Jan 2003 Jan 2002 Growth Total Active Customers 1,467,000 1,201,000 22% We expect to make further progress with recruitment, although not at this exceptional rate. Expansion of pages and product offer We have increased the number of pages in order to expand the choice of product available to the NEXT home shopper. In particular this has enabled us to develop our Home and Childrens ranges. The table below shows how the pages printed for each product area have increased: PRODUCT PAGES 2003 2002 % Growth Womens 813 803 1% Mens 459 432 6% Childrens 422 352 20% Home 451 328 38% TOTAL 2,145 1,915 12% The NEXT Directory also allows us to trial new product areas without making the level of stock investment that would be required for a retail offer. Improving service Over the last 12 months we have continued to integrate our retail and home shopping services so that our customers can shop at NEXT in the way that suits them the best. For example during the last year we allowed our home shopping customers to have their purchases delivered to a convenient store for collection (free of any delivery charge). Currently one in twenty Directory deliveries are being made in this way. We have no preference as to whether our customers buy in Retail or through the Directory. Our priority is that they purchase in whichever way is the most convenient for them because in this way they are more likely to purchase again. The profitability of sales through alternative channels is not significantly different. In the year ahead we will be particularly focussed on improving our delivery service on furniture, where we experienced some difficulties last year. NEXT FRANCHISE Our overseas franchise operation had another successful year, with sales increasing by 19% and profit by 20%. At the end of January 2003 we had 59 franchise stores compared with 49 the previous year. We expect continued progress in the year ahead. VENTURA Ventura's profit decreased to Â£11.2m compared with Â£13m the previous year. The reduction is mainly attributable to margin pressure in the call centre industry. Ventura cannot expect high margins in an industry where there is little to differentiate competing services. We must offer a high quality service at very reasonable prices, and to that end we must rigorously manage our cost base whilst delivering excellent operations to our clients. Significant progress has been made in this area over the last year and as a result Ventura has won three important new contracts in the Insurance, Energy and Public Sectors. During the year we reduced the outstanding consumer receivables by Â£5m to Â£12m. This process of collecting out the existing debt is profitable and will continue. Ventura expects to use all existing operational facilities over the next 12 months as a result of winning new business. Further capital investment will be made at our Leeds and Dearne Valley sites to increase capacity and improve efficiency in the year ahead. OTHER ACTIVITIES The profit of Â£15.1m (last year Â£12.5m) includes Â£17.9m from NEXT Asia, our product sourcing company in the Far East, and a first time contribution of Â£0.3m from NEXT Near East, which we purchased during the year. This division sources product in Turkey, Romania and Sri Lanka. Other Activities also includes our Property Management Division, Choice (an associated company which operates a chain of twelve discount stores), Callscan (which was sold during the year) and Central Costs. We have continued to recognise the cost of our Sharesave and Management share option schemes through the Profit and Loss account. Over the past five years the average annual cost has been Â£5.2m, this year the charge amounted to Â£8.2m compared with Â£8m last year. Over 7,000 of our employees currently hold a total of 9 million share options in NEXT. An actuarial valuation of our defined benefit pension scheme was again undertaken during the year. This determined that at 31 March 2002 scheme assets represented 98% of scheme liabilities, compared with 107% at the previous year's valuation. However, since then the market value of scheme assets has fallen. Under SSAP24 we estimate that at 1 February 2003 with the FTSE 100 index at 3,567 there was a past service deficit of around Â£62m, which would require an additional charge of Â£5m per annum over the next thirteen years. The net pension liability under FRS 17 at 1 February 2003 is estimated to be Â£71.2m. SHARE BUYBACKS In 2000 the board decided to embark on a programme to enhance earnings per share through share buybacks. Since that time the issued share capital of the company has been reduced by 25% from 374 million shares to 280 million. In the last financial year we purchased 44 million shares for cancellation at an average price of 893p, representing 13% of the shares in issue at the beginning of the year. As shares were purchased throughout the year the full effect of the buyback will be spread over two years. During the year the average shares in issue fell from 335 million to 314 million and, as a direct result, earnings per share were enhanced by 3%. The current year will benefit from further significant enhancement as a consequence of these purchases. Rationale for share buybacks Share buybacks allow us to leverage our balance sheet and expected future cash flows without changing the underlying operational risks of the NEXT Group. In this way they enhance earnings per share without deflecting management time from the core business. At the heart of this programme is the ability of the company to generate strong free cash flows after allowing for significant investment in new stores. The Board has set two important limitations on the use of debt to buy back shares. â€¢ The primary use of capital will continue to be investment in the development of our core businesses. We do not see share buybacks as an alternative to capital investment. â€¢ We intend to maintain the company's investment grade credit rating. Effect on future cash flows The acquisition of shares at current prices and interest rates does not significantly affect the company's ongoing cash flow. This is because the resulting additional cost of interest is almost completely offset by tax and dividend savings. Capital reconstruction In November we obtained shareholder and Court approval for a capital reconstruction to increase our distributable reserves. The new listed holding company was renamed NEXT plc and shareholders received one new share in exchange for each share previously held. Distributable reserves have thereby been increased and they will not be a limiting factor when considering dividends or share buybacks for the foreseeable future. Buybacks in the current year Since the year end 6.6 million shares have been purchased and cancelled at a cost of Â£52m, leaving 280 million shares in issue. We currently have shareholder approval to purchase up to a further 9% and, at our AGM in May, we will seek to renew the authority to purchase shares. We intend to continue with our policy of buying back shares as and when it is in the interests of shareholders generally. BALANCE SHEET AND CASH FLOW At January 2003 net borrowings were Â£189m compared with net cash of Â£194m the previous year. The cash outflow of Â£383m was due primarily to the Â£392m cost of shares purchased for cancellation. Capital expenditure amounted to Â£86m, which included Â£64m on stores. Stock levels at Â£235m were in line with our trading requirements despite being significantly ahead of last year. In January 2002 we were under-stocked, and the increase in stock on two years ago is in line with the increase in sales over that period. After each end of season Sale we write all residual stock down to 30% of original cost and at January 2003 this stock amounted to 7% of the total. DIVIDEND The Directors are pleased to recommend a final dividend of 21p against 18.5p last year, bringing the total for the year to 31p compared with 27.5p last year, an increase of 12.7%. The dividend is covered 2.2 times by earnings per share of 68.7p. CURRENT TRADING In the first seven weeks since the start of the new financial year NEXT Retail sales are 13% ahead of the previous year. Like-for-like sales in the 289 stores which have been trading for at least one year are level with last year. NEXT Directory sales for the first seven weeks are also 13% ahead of the previous year. We will make a further statement on current trading at our Annual General Meeting on 13 May 2003. Simon Wolfson 27 March 2003 CONSOLIDATED PROFIT AND LOSS ACCOUNT 2003 For the financial year ended 1 February 2002 Â£m Â£m (Unaudited) Turnover 2,202.6 1,871.7 _________ _________ Profit before interest 301.5 258.6 Net interest (payable)/receivable (0.3) 7.2 _________ _________ Profit on ordinary activities before taxation 301.2 265.8 Taxation on profit on ordinary activities (90.7) (76.0) _________ _________ Profit on ordinary activities after taxation 210.5 189.8 Dividends (86.0) (89.0) _________ _________ Profit for the year transferred to reserves 124.5 100.8 _________ _________ Earnings per share 68.7p 58.1p Diluted earnings per share 68.1p 57.3p CONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES For the financial year ended 1 February 2003 2002 Â£m Â£m Profit attributable to members of the parent company 210.5 189.8 Exchange difference on translation of net assets of subsidiary undertakings (4.6) 0.2 Total recognised gains and losses relating to the year 205.9 190.0 _________ ______ CONSOLIDATED BALANCE SHEET As at 1 February 2003 2002 Â£m Â£m (Unaudited) Fixed assets Goodwill 31.0 - Tangible Assets 323.1 296.5 Investments 0.5 0.2 Investment in own shares 47.0 37.9 _______ ________ 401.6 334.6 _______ ________ Current assets Property development stocks 9.1 9.1 Stocks 234.9 165.6 Debtors 318.1 278.6 Cash at bank and in hand 32.6 201.4 _______ ________ 594.7 654.7 Current liabilities Creditors: amounts falling due within one year 664.9 403.2 _______ ________ Net current (liabilities)/ assets (70.2) 251.5 _______ ________ Total assets less current liabilities 331.4 586.1 Creditors: amounts falling due after more than one year 37.0 20.4 Provision for liabilities and charges 19.3 18.8 _______ ________ Net assets 275.1 546.9 _______ ________ Capital and reserves Called up share capital 28.7 33.1 Share premium account - 3.8 Capital redemption reserve 1.2 5.4 Revaluation reserve 14.8 15.2 Other reserves (1,448.9) (0.7) Profit and loss account 1,679.3 490.1 _______ ________ Shareholders' funds 275.1 546.9 _______ ________ CONSOLIDATED CASH FLOW STATEMENT For the financial year ended 1 February 2003 2002 Â£m Â£m Net cash inflow from operating activities 314.9 363.8 ______ ______ Dividends from associates - 1.4 ______ ______ Returns on investments and servicing of finance Interest (paid)/received (1.1) 6.3 ______ ______ Taxation UK corporation tax paid (90.8) (71.4) UK corporation tax overpayment received 4.0 14.8 Overseas tax paid (3.4) (3.2) ______ ______ (90.2) (59.8) ______ ______ Capital expenditure and financial investment Purchase of tangible fixed assets (86.3) (72.8) Proceeds from disposal of fixed assets 3.1 3.0 Purchase of own shares by ESOP (29.6) (25.4) Proceeds from disposal of shares by ESOP 12.3 18.9 ______ ______ (100.5) (76.3) Acquisitions and disposals Disposal of subsidiary undertakings (1.2) - Purchase of subsidiary undertakings (24.6) - ______ ______ (25.8) - ______ ______ Equity dividends paid (88.4) (81.9) ______ ______ Cash inflow before management of liquid resources and financing 8.9 153.5 Management of liquid resources 152.8 (75.1) Financing Issue of new preference shares 0.1 - Company shares purchased for cancellation (391.8) (53.8) Repayments of capital element of finance leases - (0.1) Unsecured bank loans 210.0 - ______ ______ (181.7) (53.9) ______ ______ (Decrease)/ increase in cash in the year (20.0) 24.5 ______ ______ Reconciliation of net cash flow to movement in net (debt)/ funds (Decrease)/increase in cash in the year (20.0) 24.5 Cash (realised from reduction)/ deposited in liquid resources (152.8) 75.1 Increase in cash from unsecured bank loan (210.0) - Repayments of capital element of finance leases - 0.1 ______ ______ Changes in net funds resulting from cash flows (382.8) 99.7 Net funds at January 2002 194.0 94.3 ______ ______ Net (debt)/ funds at January 2003 (188.8) 194.0 ______ ______ BASIS OF PREPARATION The report was approved by the Board of Directors on 27 March 2003. Accounting policies adopted are consistent with those set out in the accounts for the year ended January 2002. The financial information for the year ended 1 February 2003 is unaudited and does not constitute full accounts within the meaning of Section 240 of the Companies Act 1985. The financial information for the year ended 26 January 2002 has been extracted from the full accounts for that year which have been delivered to the Registrar of Companies and on which the auditors have issued an unqualified audit report. SEGMENTAL INFORMATION The results for the year are for the 53 weeks to 1 February 2003 (last year 52 weeks to 26 January 2002) with the exception of Ventura and certain other activities which relate to the year to 31 January 2003. By business sector: Turnover Operating profit 2003 2002 2003 2002 Â£m Â£m Â£m Â£m Next Retail 1,579.7 1,359.7 213.9 188.2 Next Directory 471.7 362.2 65.1 49.2 Next Franchise 22.7 19.1 4.4 3.7 Ventura 97.4 101.9 11.2 13.0 Other activities 31.1 28.8 6.9 4.5 ______ ______ ______ ______ 2,202.6 1,871.7 301.5 258.6 ______ ______ ______ ______ By geographical destination: United Kingdom 2,131.4 1,808.8 278.8 241.6 Rest of Europe 49.7 44.5 1.2 0.7 North America - - 0.1 0.5 Middle East 13.6 11.6 2.4 2.1 Asia 5.5 4.2 18.9 13.9 Australasia 2.4 2.6 0.1 (0.2) ______ ______ ______ ______ 2,202.6 1,871.7 301.5 258.6 ______ ______ ______ ______ EARNINGS PER SHARE The calculation of earnings per share is based on Â£210.5m (2002: Â£189.8m) being the profit for the year after taxation and 306.2m ordinary shares of 10p each (2002: 326.8m), being the weighted average number of shares ranking for dividend less the weighted average number of shares held by the ESOP during the year. The calculation of diluted earnings per share is based on Â£210.5m (2002: Â£189.8m) being the profit for the year after taxation and 308.9m ordinary shares of 10p each (2002: 331.3m) being the weighted average number of shares used for the calculation of earnings per share above increased by the dilutive effect of potential ordinary shares from employee share option schemes of 2.7m shares (2002: 4.5m shares). HALF YEAR ANALYSIS For the financial year ended 1 February First Second First Second half half 2003 half half 2002 Â£m Â£m Â£m Â£m Â£m Â£m Turnover NEXT Retail 656.0 923.7 1,579.7 559.5 800.2 1,359.7 NEXT Directory 215.3 256.4 471.7 162.7 199.5 362.2 NEXT Franchise 10.0 12.7 22.7 8.2 10.9 19.1 Ventura 49.7 47.7 97.4 51.5 50.4 101.9 Other Activities 13.8 17.3 31.1 12.4 16.4 28.8 ________ _________ _________ _________ _________ _________ 944.8 1,257.8 2,202.6 794.3 1,077.4 1,871.7 ________ _________ _________ _________ _________ _________ Profit before tax NEXT Retail 74.5 139.4 213.9 58.9 129.3 188.2 NEXT Directory 30.2 34.9 65.1 21.8 27.4 49.2 NEXT Franchise 1.9 2.5 4.4 1.6 2.1 3.7 Ventura 5.0 6.2 11.2 6.0 7.0 13.0 Other Activities 6.5 8.6 15.1 5.4 7.1 12.5 ESOP Charge (4.5) (3.7) (8.2) (3.4) (4.6) (8.0) ________ _________ _________ _________ _________ _________ Profit before interest 113.6 187.9 301.5 90.3 168.3 258.6 Interest (charge)/ income 2.2 (2.5) (0.3) 2.7 4.5 7.2 ________ _________ _________ _________ _________ _________ Profit before tax 115.8 185.4 301.2 93.0 172.8 265.8 ________ _________ _________ _________ _________ _________ RECONCILIATION OF SHAREHOLDERS' FUNDS 2003 2002 Â£m Â£m Total recognised gains and losses 205.9 190.0 Dividends (86.0) (89.0) Shares purchased for cancellation (391.7) (53.8) New preference share capital issued 0.1 - Preference shares redeemed (0.1) - _________ _________ Total movement during the year (271.8) 47.2 Shareholders' funds at January 2002 546.9 499.7 _________ _________ Shareholders' funds at January 2003 275.1 546.9 _________ _________ CASH FLOW: RECONCILIATION OF OPERATING PROFIT TO NET CASH FLOW 2003 2002 Â£m Â£m Operating profit before interest 301.5 258.6 Depreciation 59.1 54.4 Amortisation of goodwill 1.6 - Loss on disposal of fixed assets 0.1 6.5 Anticipated deficit in ESOP 8.2 8.0 Income from interest in associated undertakings (0.4) (1.3) Increase in stock (62.8) (0.7) Increase in debtors (39.7) (9.2) Increase in creditors 52.1 46.7 Increase in provision for liabilities and charges - 0.6 Exchange movement (4.8) 0.2 ______ ______ Net cash inflow from operating activities 314.9 363.8 ______ ______ CASH FLOW: ANALYSIS OF NET (DEBT)/ FUNDS January Cash January 2002 flow 2003 Â£m Â£m Â£m Cash in hand 41.3 (16.0) 25.3 Overnight borrowings (2.5) (7.5) (10.0) Overdrafts (4.9) 3.5 (1.4) ______ ______ ______ 33.9 (20.0) 13.9 Short term deposits 160.1 (152.8) 7.3 Unsecured bank loans - (210.0) (210.0) ______ ______ ______ Total 194.0 (382.8) (188.8) ______ ______ ______ AGM / DIVIDEND / ANNUAL REPORT AND ACCOUNTS It is intended that the recommended dividend will be paid on 1 July 2003 to shareholders registered on 30 May 2003. The Annual General Meeting will be held at One Great George Street, Westminster, London SW1P 3AA on Tuesday 13 May 2003. The Annual Report and Accounts will be sent to shareholders by 14 April 2003 and copies will be available from the Company's registered office: Desford Road, Enderby, Leicester LE19 4AT and on the Company's website at www.next.co.uk. This statement, the full text of the stock exchange announcement and the results presentation can be found on the company's website at www.next.co.uk Statements made in this announcement that look forward in time or that express management's beliefs, expectations or estimates regarding future occurrences and prospects are 'forward-looking statements' within the meaning of the United States federal securities laws. These forward-looking statements reflect NEXT's current expectations concerning future events and actual results may differ materially from current expectations or historical results. Any such forward-looking statements are subject to various risks and uncertainties, including failure by NEXT to predict accurately customer fashion preferences; decline in the demand for merchandise offered by NEXT; competitive influences; changes in levels of store traffic or consumer spending habits; effectiveness of NEXT's brand awareness and marketing programmes; general economic conditions or a downturn in the retail industry; the inability of NEXT to successfully implement relocation or expansion of existing stores; lack of sufficient consumer interest in NEXT Directory; acts of war or terrorism worldwide; work stoppages, slowdowns or strikes; and changes in financial and equity markets. This information is provided by RNS The company news service from the London Stock Exchange

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