The company's full-price sales rose by 5.2% from 27 October to 28 December, 1.1% ahead of its own expectations.

It said that colder weather this November might have helped its sales performance.

The firm now expects an annual profit of £727m, up by £2m - and an increase of 0.6% on the last year.

Next expects sales to grow 3.9% over the current financial year.

'Impressive' performance

Next is the first of the big UK retailers to report on how trading went over Christmas, which is a crucial trading period for the sector.

The retailer's good performance was boosted by an increase in online sales, which rose by 15.3% over the three-month period.

Richard Lim, chief executive of Retail Economics, said: "This was an impressive end to the year as their outstanding online business continues to set them apart from the competition.

"The retailer is benefiting from years of investment in their digital proposition, continually evolving their business model to meet shoppers' heightened expectations."

However, while Next's online sales were strong, the continued shift away from the High Street was reflected by the fact that in-store sales saw a decrease of 3.9%.

According to recent data by the British Retail Consortium and Springboard, overall footfall in December on UK High Streets fell by 2.1%.

This was the fifth decrease in a row, despite retailers offering big discounts and sales around Black Friday and in the run-up to Christmas.

Retailers including John Lewis, Marks and Spencer and Ted Baker will release their Christmas trading updates next week, as well as the big supermarkets - Tesco, Morrisons and Sainsbury's.

Earlier this week, Next announced that its former chief executive Sir David Jones had died, aged 76.

He led the company for nearly 30 years, and was widely credited with saving the retail giant from collapse in the 1980s.