John Lewis: Losses slashed but turnaround plans will take another two years

However, the owner of the eponymous department store business and the Waitrose supermarket chain slashed its losses before tax by 43 per cent, from £99.2 million to £56.2m for the six months to July 29. JLP’s “Partnership Plan” was launched in 2020, with the target of a £400m profit by 2025/26, but that is now going to take until 2027/28 due to “inflationary pressures”. Investment into its strategy and customers is going to “take precedence” over its annual bonus for staff members, known as partners.

Chairwoman Dame Sharon White said workers will need to take the “mindset of owners” as the group continues efforts to improve its finances. “Our partners are the centre of the partnership and can hopefully see that right decisions are being made,” she said. “They have to take the mindset of owners here. If the roof of your house needs mending, everyone there would work together to get it fixed. We are doing all we can and we will see what position we are in come March.”

At the start of this year, the employee-owned group said it would not hand staff a bonus for only the second time since 1953 after falling to a hefty annual loss in the previous financial year. White stressed that the company’s performance over the year “picks up” more strongly over the second half after being asked whether the latest results pointed towards another annual loss.

In its half-year results, the group recorded a 2 per cent increase in sales across the partnership to £5.8 billion as it hailed higher sales on beauty and fashion but reduced demand for “technology and big ticket home items”. Bosses noted that 600,000 more customers shopped with the group in the half, taking the total number of customers to 21.4 million. It said its transformation was progressing, with efficiency savings of £31.2m during the period and more than £100m expected by the year end.

Chief executive Nish Kankiwala said: “Our transformation to modernise our business is well under way.”