John Lewis Partnership is preparing to award thousands of its employees an annual bonus for the first time in four years. The renowned retailer, operating John Lewis stores and Waitrose supermarkets, has announced a 2% bonus for its staff, totaling approximately £35 million.
This bonus marks the first time employees have received such a reward since 2022, following shop closures and staff reductions during the Covid pandemic. With a workforce of around 65,000 members, the company is distributing bonuses amidst its recent financial results announcement.
The latest financial report from John Lewis Partnership reveals a 6% increase in pre-tax profits before bonuses and exceptional items, reaching £134 million. However, the company reported a pre-tax loss of £21 million, a significant decline from the previous year’s £97 million profit.
The company attributed this loss to write-downs associated with outdated technology systems, as well as additional expenses related to tax changes introduced the prior April, including higher employer National Insurance contributions.
Sales across the business soared by 5% to £13.4 billion for the year, with the company expressing caution about the current financial year due to what it terms a “challenging macroeconomic environment.” Jason Tarry, chairman of the John Lewis Partnership, emphasized that consumer sentiment appears subdued and fragile.
Despite uncertainties, the company observed a 7% growth in supermarket sales driven by volume increases amidst a broader market decline in volumes. Mr. Tarry remains vigilant, especially in discretionary areas, and highlighted the absence of supply chain disruptions from the recent conflict in Iran.
John Lewis Partnership continues to invest £800 million in its stores as part of a significant transformation program focusing on core retail operations. Recent decisions included abandoning plans to construct approximately 10,000 rental properties due to cost escalations and market caution.
Mr. Tarry expressed satisfaction with the progress made in the company’s ongoing transformation efforts, emphasizing growth in customer numbers and record satisfaction levels. Despite market challenges and tax hikes, the company remains committed to investing in its business to drive cash and profit growth.