One of the leading U.K. clothing retailers. Strong free cash flow generation. Strong growth in the online and home-shopping segments, capitalizing on the mail-order directory catalog business. Fashion-oriented, highly competitive, and seasonal nature of the U.K. apparel retail market exposes the group to volatility in operating performance. Discretionary nature of clothing spending. Financial policy that focuses on delivering shareholder value. The stable outlook on U.K. clothing retailer Next PLC reflects Standard&Poor's Ratings Services' view that Next's ability to generate strong free cash flow should provide it with sufficient financial flexibility to maintain debt protection ratios that we consider commensurate with the 'BBB' rating. We define these ratios as funds from operations (FFO) to debt in excess of 30%,
