The firm's popular sale, which saw hundred queuing to bag bargains in its Argyle street store, kicked off on Boxing Day.

But the trend-bucking profits are being put down to an increase in catalogue business.

Next's Directory saw sales increase by 2.2% while store profits fell by 3.2% in the five months to December 24 as the firm maintained its policy of not slashing prices in the run-up to Christmas.

The firm predicts full-year profits "slightly ahead" of City forecasts ranging from £492million to £502m, but warned it was "extremely cautious" about the outlook for 2008.

Despite the tougher high street conditions, Next said the performance from its stores was in line with the guidance it gave in September, when it predicted like-for-like store sales to fall by between 1% and 3.5% in the second half of the year.

Next's chief executive Simon Wolfson is attempting to "put the magic back" into the brand with store overhauls and new ranges to beat the retail gloom.

The company said it would continue to take on profitable new space in the UK, grow its online business and expand overseas.

Shares in Next fell 6% today as investors digested the firm's pessimistic sales predictions from its high street stores, despite the company's moves to protect profits.