John Lewis has reported a pre-tax loss of £29m for the year’s first half, after restructuring costs.
However, the high street giant said its half year results ending July 31 marked a significant improvement on last year’s pre-tax loss of £635m.
Profit before exceptional items was £69m, up £124m on the comparable period last year, when the partnership made a £55m loss.
The company made a loss of £52m, up £121m, when compared to the first half of 2019/2020, which it said was a “more meaningful benchmark” given the pandemic.
Sales were up six per cent driven by online growth with almost 75 per cent of John Lewis’ sales via e commerce.
The company is in the first year of a five-year plan to return the business to sustainable profit of £400m a year.
“As we look ahead, there is significant uncertainty. Like the whole of retail, we are managing global supply chain challenges and labour shortages. We are seeing inflationary pressures, which we expect to persist,” partner and chairman, Sharon White, said.
The company said total sales hit £5.87bn across its John Lewis and Waitrose operations.
Exceptional costs were £98m in the half thanks to £24m in property costs, mostly settling lease obligations arising from shop closures, and £54m in redundancy costs.
John Lewis made savings of £66m in the first half and was in receipt of £58m of business rates relief.
The company had to make “difficult but necessary decisions” to slash costs including shutting eight John Lewis stores and consulting on closing a delivery hub.
A number of head office roles were reduced and the retailer is considering having fewer managers in stores.
The company will hire 500 workers next year to operate a new Fenny Lock warehouse.