News Worms
News Worms

Staff bonus slashed as John Lewis reports 77 per cent profit fall

Staff bonus slashed as John Lewis reports 77 per cent profit fall

"Consumer demand was subdued and we made significant changes to operations across the Partnership".

Looking ahead, John Lewis Partnership says that it expects trading to be volatile in 2018/2019, with continuing economic uncertainty and increasing competition.

The chairman said that for the first five weeks of the new financial year, Waitrose like-for-like sales were up 2.4% but John Lewis saw a 3.4% fall amid the cold snap.

John Lewis Partnership Plc has released its full year results for the 52 weeks ended January 27, 2018.

For example, John Lewis launched its first experiential store in Oxford at the end of previous year, and said it would roll out more of these this spring. "However, profit before partnership bonus, tax and exceptional items was down 21.9% mainly as a result of intensifying margin pressure in Waitrose", Chairman Charlie Mayfield said.

He added that the company had chosen to cut the proportion of profits paid as partnership bonus in order to absorb the impact of tough trading "while continuing to invest in the future and in strengthening our balance sheet". As a result, it anticipates further pressure on profits but said it will see benefits this year from the "many changes" it implemented in 2017/18.

In October the company hiked pay to all for all its workers in non-management roles, pushing average pay for those who aren't managers to £8.91 per hour.

The partnership has John Lewis stores at Norwich and Ipswich as well as Waitrose sites at Swaffham, North Walsham, Wymondham, Norwich, Saxmundham, Sudbury, Ipswich, Bury St Edmunds and Newmarket.

The drop in annual earnings was attributed to margin pressure and exceptional charges relating to restructuring, redundancy and Waitrose branch impairments. House of Fraser and Debenhams are both planning to close space as shoppers shift to buying online amid rising costs and a squeeze on disposable income as inflation outstrips wage rises. But it has slowed the pace of expansion, cut jobs and closed some Waitrose stores.

BONUSES for 84,000 John Lewis and Waitrose staff have been cut for the fifth year in a row.

At John Lewis gross sales were up 2.2 per cent to £4.84bn, with like-for-like sales growth of 0.4 per cent.

The upmarket supermarket posted a 32.1% decline in operating profit to £172 million.


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