John Lewis enjoys strong first half growth
The John Lewis Partnership has reported strong growth in its first half sales and profits despite a fall in profits at its Waitrose supermarket chain.
In the six months to 26 July the partnership’s gross sales rose by 6% to £5.011 billion while operating profit before exceptional items climbed by 8.6% to £176.1 million.
Gross sales at Waitrose increased by 4.1% to £3.146 billion with like-for-like sales rising by 1.3%. However, operating profit before exceptional items dropped by 9.4% to £145.2 million which the partnership attributed to substantial levels of investment and, to a lesser extent, tough market conditions.
The partnership said: “Being employee-owned allows us to take a long-term view about what is right for our customers and our business. We have maintained the level of investment needed to create the modern Waitrose. Our significant investments in new and existing space, online, convenience, price, hospitality, services and in deepening our understanding of our customers, positions us well for the future.”
Waitrose opened 15 new branches in the period compared with four new branches and one relocation in the same period last year. It also opened stores in five additional Welcome Break motorway locations.
Looking at the John Lewis department stores, operating profits rose by 62.2% to £56.3 million. Gross sales climbed by 9.4% to £1.865 billion, with like-for-like sales up 8.2%.
While fashion sales increased by 9.1%, home sales grew by 7.4% and electrical and home technology sales saw an uplift of 11.7%.
Online sales jumped by 25.6% and accounted for over 30% of John Lewis merchandise sales. Click & Collect sales grew by nearly 50% to make up over half of online orders.
During the six month period, John Lewis opened a new full line flexible format shop in York and a first airport shop in Heathrow Terminal 2.
Looking ahead to the second half, John Lewis chairman Sir Charlie Mayfield said the partnership had made a good start to the first six weeks of the period. He added: “Partnership gross sales are up 7.5%. Waitrose gross sales have increased by 5.2% and John Lewis gross sales are 11.3% higher than last year.
“As always, much will depend on Christmas trading, plans for which look excellent. While we expect the grocery sector to remain challenging, we anticipate sales at both Waitrose and John Lewis will continue to outperform their respective markets in the second half, reflecting the strength of both brands.”
