John Lewis narrows its losses to just £29m as sales surge past pre-pandemic levels
John Lewis chairman Dame Sharon White (pictured), said she remained ‘cautiously optimistic’ about the retailer’s recovery
The John Lewis Partnership has narrowed its half-year losses after sales surged past pre-pandemic levels. The employee-owned group behind John Lewis and Waitrose said sales rose to £5.9billion in the six months to July 30, an increase of 7 per cent on two years ago.
That was thanks to a strong online performance, as well as the return of shoppers after lockdown restrictions eased. The firm also benefited from £58million of business rates relief and lower spending on pandemic-related items such as protective equipment.
Yet the partnership still posted an overall loss of £29million, as it was forced to spend millions of pounds on redundancies and shop closures under a five-year turnaround plan. This looked bleak when compared to 2019’s half-year profit of £192million – but still represented a vast improvement on last year’s £635million loss, when the group wrote off £500million from the value of its stores.
Dame Sharon White, the partnership’s chairman who is leading its turnaround, said she remained ‘cautiously optimistic’ about the retailer’s recovery.
The 54-year-old is targeting annual profits of £400million by 2026 and wants to expand into other areas such as finance and housing. ‘It’s a five-year turnaround and we are only one year in,’ she said. ‘The first half has beaten all of our expectations but there is still a way to go.’
The partnership reported half-year sales of £3.8billion at Waitrose, up 10 per cent compared to 2019, while sales at John Lewis rose 1 per cent to £2.1billion.
At Waitrose, ready meals and food-to-go items such as sandwiches were among the top sellers as workers started to return to their offices following months of working from home.
Flowers, houseplants, champagne and sparkling wine still remained popular though, as people carried on treating themselves at home.
Meanwhile, John Lewis said strong online sales helped to make up for the ten weeks its department stores were forced to remain closed during the period.
And John Lewis is looking to what it hopes will be a blowout Christmas, with families expected to be in a ‘celebratory mood’ after last year’s festivities were hampered by Covid-19 restrictions.
However, like its rivals, the chain is grappling with supply chain issues that could derail the bonanza if they cannot be managed.
A shortage of lorry drivers and shipping freight is leading to delayed delivery of goods, with some retailers warning of restricted choices this Christmas – even when it comes to staples such as turkeys.