John Lewis Partnership reported narrowed interim losses on Thursday, but warned of “significant” uncertainty ahead as it faced labour shortages and supply chain constraints.
Pre-tax profits before exceptional items came in at £69m in the six months to 31 July, compared to losses of £55m a year earlier and of £52m in 2019.
The pre-tax loss was £29m, compared to 2020’s historic interim loss of £635m and a pre-tax profit of £192m in 2019.
Group sales rose 6% to £5.9bn. Within that, Waitrose sales were ahead 2%, or 4% on a like-for-like basis, and by 10% when compared to the same period in 2019; online sales rose 17%.
Sales at the John Lewis department stores rose 12%, or by 13% on a like-for-like basis. The retailer said nearly 75% sales had been online in first half, broadly on par with the previous year.
Sharon White, chairman, said: “We have begun the financial year with profits recovering, ahead of both last year and expectations set at our year-end results.”
But she also sounded a note of caution. “Traditionally, our profits are skewed to the second half because of the importance of Christmas, especially in John Lewis. As we look ahead, there is significant uncertainty. Like the whole of retail, we are managing global supply chain challenges and labour shortages.
“We are seeing inflationary pressures, which we expect to persist.
“Given the back ended nature of our trading year, we do not generally provide an outlook. And this year we face additional uncertainty. Even with the success of the vaccination programme, the course of the pandemic this winter is hard to call.”
John Lewis said it had received business rates relief of £58m in the first half. White said the company would decide whether or not to return the money at the year end.
The retailer is in the first year of a five-year turnaround plan aimed at returning the business to sustainable profit of £400m a year. As part of that it has closed eight John Lewis stores this year, and is consulting on the closure of a delivery hub. It has also cut jobs, with redundancy costs reaching £54m in the first half.
