The John Lewis Partnership has reported pre-tax profit up 28% to £110.5m for the half year ending July 31, with strong growth in its John Lewis department stores and grocer Waitrose.
John Lewis reported operating profit up 76.8% to £35.9m, while Waitrose reported operating profit up 6.2% to £127.8m. John Lewis’ gross sales were up 14.5% to £1.4bn, and like-for-like sales were up 12.3%. Waitrose reported gross sales up 11.3% to £2.4bn, and like-for-likes were up 3.9%. Growth in johnlewis.com was up 36.1% and its ‘Never Knowingly Undersold’ proposition has been added to johnlewis.com.
Chairman Charlie Mayfield said the performance reflected the decisions the retailer took during the recession to “invest in existing shops, in new formats, in multi-channel and in ‘value’ and we are now seeing the benefits coming through”.
He said: “Waitrose has delivered consistent and significant outperformance of the market. This has funded a range of investments for the future, including the successful marketing campaign with Delia Smith and Heston Blumenthal, the launch of new formats and encouraging results from strategic partnerships.
“John Lewis traded well ahead of expectations, with johnlewis.com growing at twice the market rate and excellent growth in fashion.”
After six weeks of the second half of the year, the Partnership’s gross sales are 9.9% higher than last year. Waitrose gross sales have increased by 8.9%, or 3.9% like-for-likes, and John Lewis gross sales are 11.7% higher than last year, or 8.8% like-for-likes.
Mayfield said: “For the remainder of this year and into 2011, we anticipate more challenging trading conditions as higher taxes and public spending cuts begin to bite and household disposable incomes come under pressure.
“However, the Partnership’s ownership model enables us to focus on the long term and we will continue to move ahead with our plans. Despite the economic headwinds, and tougher comparables in the second half, we remain confident that both Waitrose and John Lewis will continue to grow ahead of the market.”