Next hikes dividend after NIMBY backlash sparks Essex land sale
Retail giant Next has offloaded a highly contested piece of land in Essex after a group of NIMBYs blocked its plans to build a distribution centre.
The firm completed the sale on November 21, bringing to a close its intention to develop the Waltham Abbey site and generating £54m in cash.
Next has said it will return the funds generated from the sale to investors through upping its existing special dividend. The firm/’s special dividend of £3.10 per share, announced in its third-quarter update, is set to jump 45p per share as a result of the sale.
The move has also added £16m to the British retail stalwart’s profits.
The land had faced controversy from NIMBYs – ‘Not in My Backyard’ campaigners who oppose new developments in their neighbourhood – after Next’s purchase in 2021 with the aim to build a new larger regional distribution centre.
Backlash mounted over the location’s status as protected Metropolitan Green Belt land and the potential for an increase in traffic of around 1,000 extra lorry movements a day.
Next lost its appeal against the Essex council to build the centre after government inspectors dismissed the firm’s legal challenge, which began in February 2022.
The planning inspectorate said the development would have caused “significant harm” to the green belt – though reports emerged plans were set to be dismissed even if the location was changed.
Next breaks from high street slump
The fashion retailer – which runs 899 stores – has managed to maintain strong sales despite a wider slump across the high street.
Overall sales rose 10.5 per cent in the 13 weeks to October 25, far above guidance of 4.5 per cent, with international sales growth at 38.8 per cent quarter on quarter.
Analysts have praised the firm as a “standout in the discretionary retail sector” with its successful switch from brick and mortar to a hybrid digital model over the last two decades.
But the firm has still faced pressure amid mounting pressure on consumer confidence.
A leading survey closely monitored by policymakers at the Treasury and Bank of England, revealed the consumer confidence barometer had fallen to -19 in November as Brits braced for a painful Budget.
The reading for feelings about the general economic situation at present came in at -43 while the measure for expectations about the economy in the next 12 months also dropped in November.