FASHION chain Next toasted a "great year" for the group as a £695 million annual profits haul put it on course to overtake rival Marks & Spencer for the first time in its history.
The milestone performance comes after impressive Christmas trading, which helped full-year sales across its Next Directory catalogue and online division leap 12.4 per cent higher, while its stores notched up growth of 1.7 per cent.
Underlying pre-tax profits were 11.8 per cent higher on the previous year and came after Next upped its profit guidance for the second time in just over two months following the better-than-expected festive period, when it left many competitors in the shade.
It is now set to make more money than high street stalwart M&S for the first time since it launched in 1982, with M&S predicted to see underlying annual pre-tax profits fall to around £628 million.
Next chairman John Barton said: "The year to January 2014 was a great year for Next."
The group is expecting further profits growth over the year ahead of between 5 and 11 per cent, which would take its profits as high as £770 million.
It expects sales growth of between 4 and 8 per cent for Next branded sales over the current year.
But the group, which has 541 stores, added a note of caution over the outlook.
It said: "The consumer economy has steadily improved over the course of the last year.
"This modest improvement looks set to continue. However, conditions are likely to remain far from buoyant and there are real risks to the sustainability of the current recovery."
Next added that its burgeoning Home division has been helped by the housing market recovery, particularly over the last six months. Home sales now account for 18 per cent of total turnover.