John Lewis has reported that its losses almost tripled in the first half of the year, reaching £88m, up from £30m a year earlier. The increase was driven by higher costs from new waste packaging regulations and National Insurance Contributions.
The employee-owned company, which operates John Lewis department stores and Waitrose supermarkets, said the £88m figure reflects losses before tax and exceptional costs. John Lewis Partnership chair Jason Tarry said, “No doubt consumer confidence is subdued” ahead of the Budget in November.
Despite the challenging first half, the company expects full-year profits to grow following the key Christmas season. The Partnership spent £29m during the six months to 26 July on a combination of the new Extended Producer Responsibility policy, which shifts waste packaging costs to retailers and producers, and higher National Insurance payments. These costs were roughly equally split between the packaging levy and NICs.
John Lewis has also incurred expenses as part of its ongoing business turnaround programme. The Bank of England previously warned that the EPR levy could increase food prices by up to 0.5% if retailers pass on the costs to customers.
Mr Tarry highlighted that John Lewis is “a second half business” with the majority of profits expected in the latter part of the financial year, especially during the Christmas period. He added that the company anticipates strong sales for popular Christmas gifts such as wearable tech and Jellycat soft toys.
Waitrose sales rose by 6% to £4.1bn, and total revenue across the partnership increased by 4% to £6.2bn. Regarding staff bonuses, Mr Tarry said the company is committed to paying them “as soon as we possibly can,” though it is “far too early in the year” to specify when, noting that staff have not received a bonus in three years.
Over recent years, John Lewis has focused on regaining customers following the pandemic and increased competition from other retailers. The company reintroduced its Never Knowingly Undersold price promise last year, two years after initially abandoning it.
Zoe Mills, lead analyst at a research firm, said this strategy has given John Lewis a “competitive edge.” She added that the company could continue attracting customers by providing staff with strong product knowledge who can offer reliable advice in areas like electronics and make-up.
Also read: Viksit Workforce for a Viksit Bharat
Do Follow: The Mainstream formerly known as CIO News LinkedIn Account | The Mainstream formerly known as CIO News Facebook | The Mainstream formerly known as CIO News Youtube | The Mainstream formerly known as CIO News Twitter |The Mainstream formerly known as CIO News Whatsapp Channel | The Mainstream formerly known as CIO News Instagram
About us:
The Mainstream formerly known as CIO News is a premier platform dedicated to delivering latest news, updates, and insights from the tech industry. With its strong foundation of intellectual property and thought leadership, the platform is well-positioned to stay ahead of the curve and lead conversations about how technology shapes our world. From its early days as CIO News to its rebranding as The Mainstream on November 28, 2024, it has been expanding its global reach, targeting key markets in the Middle East & Africa, ASEAN, the USA, and the UK. The Mainstream is a vision to put technology at the center of every conversation, inspiring professionals and organizations to embrace the future of tech.
