A “particularly strong” performance in womenswear led The John Lewis Partnership to a 3.2% sales increase in its fashion division for the full year but it was not enough to offset a 77% drop in group earnings.
For the 52 weeks to 27 January, the Partnership reported a 5% increase in sales at its womenswear division, while group revenue grew 1.8% to GBP10.2bn (US$14.1bn) at the apparel, technology, and home retailer. Profit before tax, however, fell 77% on the prior year to GBP103.9m.
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“As we anticipated, 2017 was a challenging year,” said Sir Charlie Mayfield, chairman of John Lewis Partnership. “Consumer demand was subdued and we made significant changes to operations across the Partnership which affected many partners.”
Following a profit warning in January, Sir Mayfield said the business chose to reduce the proportion of profits paid as Partnership Bonus last year in a bid to absorb the impact of tougher trading conditions.
Looking ahead, the group said it expects trading to be volatile in 2018/19, with continuing economic uncertainty and no let up in competitive intensity. As a result, it anticipates further pressure on profits but said it will see benefits this year from the “many changes” it implemented in 2017/18.
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