John Lewis profits fund 18% bonuses
John Lewis Partnership staff have been rewarded with bonuses worth 18% of their salaries as the group defied retail gloom to post a surge in profits.
The employee-owned firm said a strong year for its department stores and supermarket Waitrose means its 76,500 staff will share a bonus pot of £194.5 million, up from last year's pool of £151 million.
The partnership posted a 20% rise in pre-tax, pre-bonus profits to £367.9 million for the year to January 31, as sales soared 10.6% to £8.21 billion.
Chairman Charlie Mayfield announced plans to create 4,300 jobs this year and invest £600 million in the business.
John Lewis department stores have outperformed rivals recently as its more affluent consumers were able to cope better during the recession.
The group performed well through the freezing conditions that swept the country in December, but weekly sales figures since the end of January have suggested customers are starting to spend more cautiously.
But five weeks into the new financial year, Partnership gross sales were still 6.5% higher than last year, as both Waitrose and the department stores posted growth.
Mr Mayfield said the Partnership benefited from its multi-channel approach, including its department store website JL.com, which saw sales grow 38% to £538.2 million, as well as Waitrose Deliver and its supply relationship with online grocer Ocado.
John Lewis department stores posted like-for-like sales growth of 10% during the year, with operating profit returning to pre-recession levels after increasing by 22% to £201.2 million.
The group said sales were driven by growth in most departments, with fashion up 15%, home ahead 12%, and electricals and home technology lifting 8%. Elsewhere, supermarket Waitrose saw food sales on a like-for-like basis grow 4%, excluding petrol, while operating profits increased 3% to £274.9 million.