// John Lewis Partnership will reinstate a bonus of 3% for its partners after profits before exceptional items rose 38% across the business
// Department store business John Lewis achieved record sales of £4.93bn during the year, despite having 16 fewer stores and lockdown forcing the closure of all of its shops for 10 weeks during the period
John Lewis Partnership has reinstated a bonus for partners after profits before exceptional items rose and the department store posted record annual sales.
Staff will receive a 3% bonus for the year.
The John Lewis department store achieved its highest ever sales of £4.93 billion, which was up 8% on a like-for-like basis, a 10% improvement on two years ago, despite having 16 fewer stores than the previous year and lockdown forcing the closure of all of its shops for 10 weeks of the year.
Online accounted for two thirds of the department store’s sales over the year.
Across the wider group, profits pre-exceptional items jumped 38% year on year to £181 million in its full year to 29 January. On this measure profits were 159% better than two years ago, pre-pandemic.
However, when exceptionals were taken into account, John Lewis Partnerships made a pre-tax loss of £26 million. This was a dramatic improvement on the £517 million loss it made the previous year, when it faced a big write-down in the value of its John Lewis stores.
Waitrose sales for the year hit £7.54bn, up 1% on a like-for-like against last year, but a 11% jump on a two-year basis.
Alongside the 3% bonus, staff will also benefit from a 2% pay rise this year as the Partnership will pay voluntary Real Living Wage nationwide, investing £54 million in pay.
John Lewis Partnership chair Dame Sharon White told staff: “I want to thank you for your commitment and dedication in what has been another tough year. With the pandemic and with so much change within our business, I don’t underestimate the personal impact and I am truly grateful.
“As we head into the second year of the Partnership Plan, our five year strategy to transform the business, we’re gaining momentum in the most competitive retail market in history. Our focus on quality, value, sustainability and exceptional service is serving us well.”
The Partnership cut costs by £170 million over the year, which White said was a major factor behind its profit growth.
She admitted that “difficult decisions” had been taken such as reducing management roles in stores and reducing central teams. Eight John Lewis stores and a delivery hub closed over the year, which White said was necessary to ensure the Partnership is sustainable in the future.
White told staff: “We have made a good start to our Partnership Plan but are only one year through our five year transformation. Looking ahead, we see continued uncertainty from global events, affecting the economic environment, our customers, partners and society.
“As inflation and energy prices rise, our customers face higher living costs. While this creates uncertainties as we look ahead, we remain focused on investing significantly in our Partnership Plan to transform and grow our business.”
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In the year ahead it plans to invest £119 million into its John Lewis shops, digital services and distribution capabilities. It will also plough £500 million into giving John Lewis customers “everyday quality and value” and improving its MyJL Loyalty proposition.
It will invest £55 million into refurbishing 23 Waitrose stores in the year ahead, down from the £90 million it invested in its last financial year, and £72 million into improving the grocer’s digital services and distribution.
Online sales grew 14% year on year at Waitrose in 2021/22 and now stand at 17% of total sales.
The Partnership will also work with Waitrose suppliers to keep prices as low as possible and to offer savings on the products customers buy the most through its revamped MyWaitrose loyalty scheme.
Over the year the business opened 38 dedicated John Lewis spaces in Waitrose stores and is planning a further 49 by the end of its current financial year.
The retailer will also develop its property rental proposition and roll out its financial services arm in the year ahead.
White said: “This is a year of opportunity for the Partnership, despite economic headwinds. We have come through so much already and our solidarity will continue to carry us through. I am confident that by continuing to invest in our strategy we will deliver for our customers, Partners, suppliers and communities.”
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