John Lewis profits up 60%
British retailer John Lewis posted a 60 per cent rise in first-half profit as both its department stores and upmarket Waitrose grocery chain outperformed rivals in a tough market, benefiting from a step-up in investment in previous years.
The employee-owned group said it was boosted by a host of major events this year such as the Queen's Jubilee and London Olympics, but it cautioned that it did not expect the heady rate of growth to continue in the second half due to the ongoing investment programme.
"The partnership has delivered strong growth in the first half," Charlie Mayfield, chairman of John Lewis Partnership, said.
"Both Waitrose and John Lewis increased their market shares."
John Lewis has done better than the wider market because its generally more affluent customers have been less impacted by Britain's economic downturn, while improvements to product and service and new modern stores have impressed the consumers.
The group said it made a pre-tax profit of £144.5 million (€180.2 million) in the six months to July 28, up 60 per cent. Group revenue climbed 8.6 per cent to £3.9 billion.
Many British retailers are finding the going tough as consumers hold back spending in the face of inflation, meagre wage growth, employment fears and government austerity measures.
John Lewis bucked the gloom with operating profit at its department stores up 189 per cent to £45.6 million, on gross sales up 12.8 per cent.
The department stores division, which has a bias to the south east of England, has set the pace in the sector this year, outperforming rivals as wet weather has driven footfall from the high street to the covered shopping malls where its stores are often located.
Unseasonally cold weather was also favourable for its key household goods business and the online division performed well.
At Waitrose operating profit increased by 29 per cent to £142 million, on gross sales up 6.6 per cent.