Upmarket UK retailer Waitrose & Partners has posted a 1.2% increase in revenue to £6.43 billion (€7.47 billion) in the full year to 26 January, its parent firm the John Lewis Partnership has revealed.
Operating profit at the grocer was up 18.1% to £203.2 million, with the group saying that this was 'driven by like-for-like sales growth of 1.3% and improved gross margin, which benefited from 24 range reviews, as well as stronger operational performance and well controlled costs, especially in the second half year'.
In a statement, Waitrose & Partners confirmed that it is to sell five of its outlets to other retailers, while it also recently announced changes to the commercial operating model in its head office.
Commenting on its performance, Thomas Brereton, retail analyst at GlobalData, said, "Waitrose has endured the troubles in upmarket retail through inventive product innovation, accelerated in 2018 to include rapid expansion of its free-from ranges, increasing the number of vegan SKUs 60% throughout the year with the likes of own-label fishless fingers."
On its future strategy, Brereton added that the grocer will likely embolden its switch to online, "having already identified five stores that it would like to dispose of this year and full-year commentary strongly focused on further investment in Waitrose.com and smartphone apps.
"And this is the right move for Waitrose; although online sales are growing at 14%, penetration is only at 7.1% - notably below the 9.4% online penetration for the overall grocery market. With its partnership with Ocado set to end in 2020 (replaced by close rival M&S Food), Waitrose are now looking to stand on its own two feet in online food retail, a logical strategy given the overall online grocery market’s 9.3% growth in 2018.''
© 2019 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: European Supermarket Magazine.