John Lewis Partnership Plc’s profits jumped after the British retailer lowered prices, modernized shops and opened new supermarkets to win back shoppers.
The partnership, which runs department store John Lewis and upmarket grocer Waitrose, reported annual profit before tax and exceptional items tripled to £126 million ($163 million) from a year ago.
The improved picture came as Jason Tarry, the former head of UK and Ireland for Tesco Plc, oversaw his first results as chairman of the employee-owned group. He replaced Sharon White in September.
Despite the stronger results, which helped overall sales rise 3%, John Lewis said it will not make an extra annual payment to staff, known as a partnership bonus. It will invest up to £600 million to improve the business by updating stores and bolstering its supply chain.
It has now not paid a bonus to partners for the past three years. Earlier this month, it announced a 7.4% pay increase for most shop floor workers, with the highest performers getting 9.4%.
John Lewis expects a further rise in profits during this 2025-26 financial year, though it cautioned that the wider economic outlook will be challenging for consumers and the business. The UK retail sector has been warning about the impact of higher taxes as the government tries to repair public services.
Volumes grew 2.2% at Waitrose. The grocer has lowered prices and increased sales of its own-brand products. It has also partnered with restaurant chains Ottolenghi and Gymkhana, as well as food delivery platform Just Eat, adding to Uber Eats and Deliveroo.
John Lewis last year scrapped a plan for 40% of profits to come from non-retail ventures — such as build-to-rent flats and financial services — by 2030. It has refocused on retail, relaunching its Never Knowingly Undersold promise — which price matches rivals — and adding ranges including in beauty and technology.