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John Lewis profits drop, cuts staff bonus

By Prachi Singh

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Management

John Lewis Partnership profit before bonus, tax, exceptionals and IFRS 16 was 123 million pounds (158.5 million dollars), which the company said in a statement, was a weaker performance than expected, driven by significant operating profit decline in John Lewis, which was partly offset by operating profit growth in Waitrose, and lower net group costs and finance costs. John Lewis operating profits before exceptionals and IFRS 16 were down 75 million pounds to 40 million pounds (51.5 million dollars). The company added, including exceptional items profit before tax was 146 million pounds (188.2 million dollars), up 29 million pounds or 25 percent on last year.

“Partnership made 123 million pounds of profit in 2019/20, which is 23 percent less than we made in 2018/19. This is a weaker performance than we had hoped for, driven by significantly reduced profitability in John Lewis. Despite a solid performance in Waitrose, it is our third year of declining profit across the Partnership as a whole. This year we saw a one-off reduction in the value of our John Lewis shops of 123 million pounds, principally as a result of shops playing less of a role in driving online purchases. We are, therefore, awarding a bonus this year of 2 percent,” said Sharon White Chairman of the John Lewis Partnership.

John Lewis undertakes strategic review to boost sales and profit

Total sales at John Lewis of 4,784.7 million pounds were down 2.1 percent, while like for like sales were down 1.8 percent.

“The strategic review will focus on how we strengthen our core retail business and develop new services outside retail. As part of this we will also look at ‘right sizing’ our store estate across both brands, through a combination of new formats and new locations; repurposing and space reductions of existing stores; and closures, where necessary. Three Waitrose stores that will close later this year include Helensburgh, Four Oaks and Waterlooville,” added White.

Picture:John Lewis media centre

John Lewis
John Lewis Partnership