John Lewis Partnership will make an annual bonus payout of 11% of salary, down from 15% last year, as declines at Waitrose weigh down on group profits.
The bonus amounts to £156.2m across the business.
JLP, which comprises John Lewis and Waitrose, made gross sales of £10.9bn for the year to January 31, up 7.6% on the previous year. Operating profit rose 6.3% to £450m, but profit before partnership bonus and tax fell 9% to £342.7m.
John Lewis like-for-like sales increased 6.5%, outperforming Waitrose’s 1.4% sales rise.
Gross sales at John Lewis were up 9.2% to £4.4bn and operating profit climbed 10.8% to £250m.
Fashion sales were up by 8.3%, with notable increases in nursery products (16.3%), kidswear (8.2%) and women’s accessories (8.5%). John Lewis’ own-brand Kin range increased by 46.6% during the year.
“The investments made over many years in systems, logistics and IT infrastructure combined to enable John Lewis to make more deliveries via click-and-collect than to customers’ homes for the first time,” said JLP chairman Sir Charlie Mayfield. “John Lewis was able to fulfil over 6.4 million orders over the year with 98.7% of parcels in store the following day.”
He added: “Our 93,800 partners will receive a bonus of 11%, equivalent to nearly six weeks’ pay. And for the first time in 15 years, thanks to the new legislation that puts employee ownership on a similar footing to other forms of ownership, no partner will pay tax on their bonus up to £3,600.”
He said the outlook for John Lewis this year is robust.
“Our focus remains on positioning our brand to outperform and our investment in supply chain and systems, which has been growing for some years, will exceed that in new shops and refurbishments for the first time this year.”
Gross sales after the first five weeks of the current year are up by 1.9% against last year across the group. John Lewis gross sales are 3.7% higher than last year, up 2.6% on a like-for-like basis.
However, profits in the grocery sector are expected to be materially lower for a period of time.