John Lewis staff bonuses set to be cut again
More than 90,000 John Lewis and Waitrose staff are expected to see staff bonuses cut yet again when the partnership that owns the two firms posts a fall in annual results on Thursday.
Staff bonuses are expected to fall to 9% or 10% of annual salaries this year, according to respected independent retail analyst Nick Bubb - compared to the 11% staff were handed last year and 15% in 2013.
Analysts expect the John Lewis Partnership, which is owned by employees of the two retail chains, to report annual pre-tax profits before exceptional items of around £300 million, from £342.7 million a year ago.
The business said in January its annual results would be hit by £60 million of pension charges ''as a result of market driven volatility''.
Department store chain John Lewis posted a rise in Christmas trading figures as surging online sales offset declines across its stores.
Over Christmas, the retailer reported a like-for-like sales lift of 5.1% in the six weeks to January 2, but it relied on a 21.4% jump in online trade as comparable store sales dropped 1.2%.
The partnership also revealed ''challenging'' trading at its Waitrose supermarket arm, which suffered a 1.4% fall in like-for-like sales excluding fuel over the six weeks.
Sir Charlie Mayfield, chairman of the John Lewis Partnership, said: ''This has been a strong Christmas trading period for the partnership despite the non-food market seeing significant shifts in trade patterns and the grocery market continuing to be challenging.''
The employee-owned firm, which runs 46 John Lewis stores, shrugged off the unusually mild December weather as it hailed ''impressive'' trading across fashion, home and technology.
Menswear was its best-selling area in fashion, while Star Wars Lego sets were among its most popular toys.
This came despite fears sparked among clothing retailers at the start of the year after Next posted a shock fall in its store sales and a sharp slowdown in its Directory catalogue and online arm, blaming the mild conditions in November and December.
John Lewis said the number of shoppers on the high street was lower around Christmas as consumers continued to shift online, with trading through its website making up 40% of all sales in the six-week festive season.
Results for the Waitrose business confirmed the tough conditions in the supermarket sector as grocers battle amid a ferocious price war and the increasing might of discounters Aldi and Lidl.
In September, the John Lewis Partnership posted a 26% slide in half-year profits to £96 million after being hit by costs of its staff pension fund and warned full-year results would also be sharply lower in a tough retail market.