CORRECTED - UPDATE 3-Next sales to keep falling, sees margin pressure

(Corrects paragraph 5 to show Next shares up 19 percent over the last three months, not down)

* Full-year pretax profit 428.8 mln pounds, down 13.9 pct

* Dividend maintained at 55 pence

* Next Retail H1 sales seen falling 6 pct to 9 pct

* Next Directory H1 sales seen flat to down 2 pct

* Shares down 0.62 pct by 1030 GMT

(Adds more detail, analyst comment, updates shares)

By James Davey

LONDON, March 26 (Reuters) - British fashion and homewares retailer Next Plc (NXT.L) sees sales and margins falling further in 2009, it said on Thursday as it posted an expected 13.9 percent profit decline for the past year.

"It's going to be difficult but it's not going to be the end of the world," Chief Executive Simon Wolfson told Reuters, adding he was confident the group will meet profit expectations in the year to the end of January 2010.

"We're very comfortable with the positioning of our ranges at the moment," he said.

Wolfson said Next has several advantages to enable it to trade through the economic downturn, namely a proven business model, modest debt, a strong internet presence and the ability to take advantage of a weakening property market.

Shares in Next, which have risen 19 percent in the last three months, were down 0.62 percent at 1286 pence at 1030 GMT, valuing the business at 2.52 billion pounds ($3.68 billion).

"We expect Next to emerge as one of the winners from the recession, as capacity drops out of the market and it benefits from strong operational gearing," Panmure Gordon analyst Philip Dorgan said in a research note.

The group said it was budgeting for like-for-like sales to fall between 6 percent and 9 percent at its Next Retail stores chain in its first half to the end of July, with operating margins falling by around 3 percent to about 10 percent.

At the catalogue and online business Next Directory it forecast sales would be flat to down 2 percent, with operating margins broadly flat at around 19 percent.

Next, the UK's second-largest clothing retailer by sales value, reiterated it expected significant upward pressure on prices and downward pressure on margins in the second half of the year as a result of sterling's weakness on product sourcing costs.

Wolfson said the group would have no alternative but to raise clothing prices by between 3 percent and 5 percent, for example about 50 pence on a pair of 20 pounds jeans.

"We've seen a 30 percent devaluation of the pound against the dollar which means our starting position is 30 percent more expensive. You can only absorb so much of that in margin," he said.

Many UK retailers have been struggling as indebted consumers rein in spending amid soaring unemployment, sliding house prices and fears of a deep recession. [ID:nLQ416558] [ID:nLP942431]

Also on Thursday Moss Bros Group Plc (MOSB.L), the men's fashion retailer, swung to a first-half loss. [ID:nLQ387621]

Next, which trades from over 460 stores in the United Kingdom and Ireland, said it made a pretax profit of 428.8 million pounds for the year to the end of January 2009.

This compares with analysts' consensus forecast of 430 million pounds, according to Reuters Estimates, and 498.1 million pounds in the previous year.

Revenue fell 1.7 percent to 3.27 billion pounds and the total dividend was maintained at 55 pence.

Net debt was reduced to 629 million pounds, with the group having debt facilities in excess of 1 billion pounds.

Prior to Next's statement analysts were forecasting a pretax profit of about 365 million pounds for its current year to the end of January 2010. ($1=.6853 Pound) (Editing by Sharon Lindores)