High street giant Next has cut its sales and profit targets after shutting its operations in Russia and Ukraine.

       The London-listed retailer said earlier this month it was winding down its Russian distribution site following the Kremlin’s invasion of Ukraine.

       It said on Thursday morning the closure of websites in both Russia and Ukraine will knock a predicted ￡85 million off its sales forecasts for the current financial year.

       Next added the impact of the war will also pull its profits down by ￡18 million for the year, although this will be partially offset by “better-than-expected” sales in the UK.

       It downgraded profit targets by ￡10 million as a result.

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       The effects of the pandemic are ongoing and we remain mindful of macroeconomic and geopolitical risks, but our continued investment over many years in our people and our systems has generated strong and resilient results in the past year and we believe that it will continue to do so

       Michael Roney, Next chairman

       Nevertheless, the company still expects a 5% increase in sales for the year, while profits are set to rise by 3.3% to ￡850 million.

       Lord Simon Wolfson, chief executive of Next, told the PA news agency the company is expecting to increase prices by an average of 3.7% over the half-year to July.

       He said pricing is expected to rise by an average of 8% in the following six month period, with fashion set for a 6.5% rise.

       Lord Wolfson said Next has factored in potential for “subdued” trading as the cost of living crisis bites over the rest of the year.

       “Over the past 20 years, we’ve seen that what really matters is what’s in people’s bank accounts rather than costs…” he said.

       “In January, when we laid down our outlook, people suggested it could be pessimistic but we thought confidence could be subdued.”

       It comes as the retailer said pre-tax profits jumped 140% to ￡823 million for the year to January, compared with the previous year, with profits also 10% above pre-pandemic levels.

       Next said this was buoyed by a 12.8% increase in brand full price sales for the year against pre-pandemic levels.

       The firm said UK sales are currently “ahead of where we expected them to be” for the past three months after a strong return back to shops.

       It also highlighted a “very sharp reversal” in lockdown fashion trends, as formal clothing recovered and spending on home and very casual clothing fell back.

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       Next chairman Michael Roney said: “We enter 2022 with confidence in the outlook for our business and its ability to continue its successful evolution.

       “The effects of the pandemic are ongoing and we remain mindful of macroeconomic and geopolitical risks, but our continued investment over many years in our people and our systems has generated strong and resilient results in the past year and we believe that it will continue to do so.”