John Lewis’ fashion sales rose 4.2% in the first half of the year, thanks to steady performances from the business’ own label ranges such as Somerset by Alice Temperley and John Lewis & Co.
Although this was behind the wider group’s performance – John Lewis Partnership, which includes Waitrose, saw sales rise 7.3% to £4.73bn in the six months to July 27, while the department store business itself rose 6.6% to £1.71bn – the company said it gained market share in fashion.
Overall, John Lewis saw like-for-likes rise 5.1%, with revenue up 6.5% to £1.37bn, while gross sales via its website rose 17.1% to £439.9m. However operating profit fell 23.9% to £34.7m as a result of more than £15m restructuring costs towards “streamlining John Lewis department store management structures and a new distribution infrastructure”.
During the six months, John Lewis saw annual online sales reach the £1bn milestone – a year earlier than targeted. It also announced a new £97m distribution centre in Milton Keynes, which will open in 2015.
JLP chairman Charlie Mayfield said the first half performance was “slightly ahead of our expectations”.
He added: “I am particularly pleased that both Waitrose and John Lewis again increased their market shares significantly during the first half. Year-on-year, we grew our customer numbers by 6%, helped especially by initiatives such as myWaitrose and our market leading omni-channel offer in John Lewis.
“There are some fundamental changes taking place in retail and the range and scale of these investments demonstrate our determination to take full advantage of the market opportunities that they bring.”
Mayfield said he had a positive outlook for the rest of the year on the back of signs of wider economic recovery. “I’m encouraged by progress this year and am confident of the plans we have in place for Christmas,” he said. “Despite a strong second half last year, both during the Olympics and at Christmas, I expect us to trade positively in the second half.”