British retailer John Lewis posted 60% increase in pre-tax profits as its department stores and Waitrose, its upmarket grocery chain, beat rivals in a tough market scenario, owing to an investment boost over previous years.
The company reported that gross sales for the half year to July 28 increased to £4,405.9 million, up from 4,052.1 million last year while pre-tax profits increased to £145.5 million, in comparison to £91.2 million a year ago.
Waitrose reported its gross sales increased by 6.6% and operating profit by 29%. John Lewis, which witnessed a volatile first half, saw its gross sales grow by nearly 13% and its operating profits increased more than twice.
John Lewis and Waitrose attributed their profits to three main factors. “Firstly, we benefited from the more favourable conditions created by a number of one-off events, such as the Diamond Jubilee, the lead up to the London 2012 Olympic and Paralympic Games and the anniversary of the VAT increase which depressed sales last year.”
The second reason that the company cited for the excellent results, included, strong trading teams which clearly differentiated products backed by outstanding service. In Waitrose, the company launched more products than ever before and extended the ‘brand price match’. In John Lewis, the firm captured market share in all categories and launched a series of innovative design collaborations.
Development of multi-channel operations while improving business efficiency saw accelerated sales and profits. The extension of Click & collect to most Waitrose shops also made an important contribution towards improved sales.