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Britain’s John Lewis cuts losses and restores staff bonus, Retail News, ET Retail

Britain's John Lewis cuts losses and restores staff bonusLONDON: British retailer, the John Lewis Partnership, reported on Thursday sharply lower annual losses and restored its staff bonus, saying its recovery plan was gaining momentum.

The employee-owned group, which runs John Lewis department stores and upmarket supermarket chain Waitrose, has been hit hard by the COVID-19 pandemic.

It made a pretax loss of 26 million pounds ($34.3 million) in the year to Jan. 29 versus a loss of 517 million pounds in 2020-21.

However, profit before exceptional items rose 38% to 181 million pounds and it said it would pay a 3% bonus to staff, whom it calls partners, equivalent to 1.5 weeks’ pay and totalling 46 million pounds.

Chairman Sharon White set out a five-year recovery programme in October 2020. She has closed stores and cut jobs but is investing 1 billion pounds in online and improvements to stores, diversifying beyond retail and seeking more partnerships.

Her plan seeks efficiency savings of 300 million pounds a year by 2022 and targets a profit of 400 million pounds by year five.

The 158-year-old group cut costs by 170 million pounds in fiscal 2021-22.

Total partnership sales rose 1% to 12.5 billion pounds, with John Lewis making sales of 4.93 billion pounds, up 4%, and Waitrose 7.54 billion pounds, down 1%.

Exceptional charges of 161 million pounds were booked – mostly restructuring costs, property lease exit costs and a further small write down of the value of John Lewis stores.

“As inflation and energy prices rise, our customers face higher living costs,” said White.

“While this creates uncertainties as we look ahead, we remain focused on investing significantly in our Partnership Plan to transform and grow our business.”

The partnership has committed to paying the voluntary Real Living Wage nationwide and has set this year’s pay review at 2%.

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