DE4CC0DE-5FC3-4494-BCBF-4D50B00366B5

John Lewis Sees Profits Fall As Waitrose Attracts New Customers

By Publications Checkout
Share this article
John Lewis Sees Profits Fall As Waitrose Attracts New Customers

Parent company of Waitrose, John Lewis has reported that its profits fell by 11 per cent for the year ending January 30, 2016, as the result of lower property profits, a difficult trading environment and higher pension charges.

The company made a profit before partnership bonus, tax and one-off items of £306 million (around €392 million), which was within a guidance of between £270 million and £320 million, but 10.9 per cent less that the previous year’s profits.

Chairman of John Lewis Partnership, Sir Charlie Mayfield said in a statement, "Market conditions were challenging through the year with deflation in grocery of 2.6 per cent and subdued demand in non-food."

Waitrose saw operating profit of £232.6 million, which was down 2 per cent on the year before, but when excluding property profits, was up 2.5 per cent. Gross sales were down by 0.7 per cent to £6.46 billion, with like for like sales down by 1.3 per cent.

However, the grocery retailer grew its customer numbers, and had an average of 220,000 more customer transactions a week compared with the previous year.

ADVERTISEMENT

Waitrose’s click & collect service grew in popularity, with collections of John Lewis orders from Waitrose up by 19 per cent, and 70 per cent of all click & collect orders being picked up from the supermarket’s branches.

The launch of the Pick Your Own Offers initiative in June has also attracted more that a million customers to Waitrose’s loyalty scheme.

Commenting on John Lewis’ outlook for 2016/17, Sir Mayfield said, “Conditions in the market will remain difficult, especially in grocery.

"However, given our continued investment in both our operations and the customer offer, I expect sales in both Waitrose and John Lewis to continue to perform comparatively well against the market."

© 2016 European Supermarket Magazine – your source for the latest retail news. Article by Jenny Whelan. To subscribe to ESM: The European Supermarket Magazine, click here.

Get the week's top grocery retail news

The most important stories from European grocery retail direct to your inbox every Thursday

Processing your request...

Thanks! please check your email to confirm your subscription.

By signing up you are agreeing to our terms & conditions and privacy policy. You can unsubscribe at any time.