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John Lewis parent sees profits drop by 8.7%

Published: 7 March 2012
The John Lewis Partnership's financial results for the year ending January 28, 2012, revealed the group's operating profit declined by £37.7m to £393.3m, impacted by heavy investment in store openings and new initiatives.
John Lewis parent sees profits drop by 8.7%
Gross sales across the partnership, which operates John Lewis department stores and Waitrose, were up by £523.2m to £8.73bn, an increase of 6.5%. Like-for-like sales in John Lewis department stores were up 1.3%, while its online store, reported a 26.3% sales increase to £680.8m.

The Partnership explained that its profits were held back by planned investments, including pre-opening costs of £27.9m. The group opened 29 Waitrose branches over the course of the year, as well as two new 'John Lewis at home' stores in Chester and Tamworth. It has also extended its 'click & collect' service to all John Lewis stores and 94 Waitrose outlets.

The group has invested in extending a new shop fit, as exampled in its new Stratford store, across all existing John Lewis stores, while its first smaller format department store will open in Exeter, boasting a number of multi-channel services. Two 'at home' openings are also planned for Chichester and Newbury, while a full upgrade of website is in the pipeline.

John Lewis Partnership chairman Charlie Mayfield said: "We have achieved a good sales performance in a tough year for the economy. Profits are lower than last year, but better than expected and I'm delighted to announce that all 81,000 partners will be receiving a bonus equivalent to over seven weeks' pay.

"Profound changes are taking place in the retail sector and importantly this was a year when we upped the pace of innovation and investment. That came at the price of some short-term profit but leaves us in a good place at the start of this year."

John Lewis was recently named as the official department store provider for the London 2012 Olympics.


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