John Lewis has posted losses of £25.9m for the first half of the year, blaming the shifting retail landscape and ongoing concerns over Brexit.
With trading conditions already less than favourable, John Lewis said in its half-year results that if the UK were to leave the EU without a deal, the effect would be “significant”, and it would “not be possible to mitigate that impact”.
John Lewis Partnership chairman Sir Charlie Mayfield said that the UK’s exit from the EU continued to “weigh on consumer sentiment at a crucial time for the sector as we enter the peak trading period”. He added that John Lewis had been preparing for Brexit by increasing its foreign currency hedging and stockpiling where possible.
Sir Charlie said that he expected retail conditions to remain tough throughout 2019 – although he said the second half of the year was typically stronger for the retailer.
Commenting on these difficult trading conditions, the chairman said that the face of UK retail was changing rapdily.
“The re-drawing of the UK retail landscape continues apace,” he said.
These headwinds drove the compnany’s revenues down by 1.4%, from £4.8bn to £4.7bn, for the first half of the year to 27 July.
In March, John Lewis Partnership – which owns John Lewis and Waitrose – said that staff bonuses at the two companies had been slashed to the lowest level in 66 years after a “challenging” year in which underlying profits fell 45%.
At Waitrose, despite a weak grocery market, the company said it had a good trading performance, with only a “marginal decline in like-for-like sales”, and continued improvement in gross margins.
It also said it had seen strong online grocery sales growth of 10.7%, a figure “well ahead of the market”.