John Lewis Partnership is preparing to award thousands of employees with an annual bonus, marking the first time in four years for such a gesture.
The company, which operates John Lewis stores and Waitrose supermarkets, announced a 2% bonus for its workforce, totaling around £35 million. This bonus distribution is the first since 2022, a period marked by store closures and staff reductions due to the Covid-19 pandemic, with approximately 65,000 employees.
Following the release of its latest financial results, John Lewis Partnership reported a 6% increase in profits before tax, bonus, and exceptional items, reaching £134 million. However, the company also disclosed a pre-tax loss of £21 million, down from a £97 million profit the prior year.
The company attributed this loss to write-downs associated with outdated technology systems and additional expenses related to tax adjustments implemented the previous April, including heightened employer National Insurance contributions.
Despite the financial challenges, the business saw a 5% rise in overall sales, reaching £13.4 billion for the year. John Lewis Partnership expressed caution about the coming financial year, citing a challenging economic landscape.
Chairman Jason Tarry acknowledged the subdued consumer sentiment, emphasizing the company’s cautious stance, particularly in discretionary spending areas. However, he noted a positive 7% growth in supermarket sales driven by increased volumes, contrasting with a broader market decline.
Tarry highlighted the company’s resilience amid external factors, such as the recent conflict in the Gulf, emphasizing the absence of supply chain disruptions and minimal expected impact on energy costs in the short term.
He commended the progress of the company’s ongoing transformation initiative, involving an £800 million investment in store enhancements and a renewed emphasis on core retail operations. Notably, plans for a large-scale rental property project were shelved due to escalating costs and market uncertainties.
Tarry expressed satisfaction with the company’s customer-focused strategy, citing growing customer numbers and record satisfaction levels. Despite market challenges and tax increases, the company remains committed to strategic investments, resulting in improved cash flow and profitability.
