Employees at Waitrose and John Lewis are to receive their lowest bonus in 12 years, at 11% of their salary, after profits at Waitrose took a hit in a competitive market.
John Lewis Partnership said in an annual statement that its department store brand, John Lewis, saw a 10.4% rise in operating profit to £442.3m in 2014 but Waitrose saw a drop of 24.4%, as a price war in the supermarket sector took its toll.
The chairman of John Lewis Partnership, Sir Charlie Mayfield said: “The partnership achieved a strong sales performance with increased market share in both Waitrose and John Lewis, and customer numbers up by 6% and 4% respectively. Profit before partnership bonus, tax and exceptional items is down 9.0% (down 10.5% on a 52 week basis), with increased profits in John Lewis offset by a decline in Waitrose."
He added: “We expect the returns for the grocery sector to be materially lower for a period of time. Waitrose's value perception has improved significantly over the last few years and we will continue to defend that hard won position during this period of change in the grocery sector.
“For John Lewis, the outlook 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 refurbishment for the first time this year.”
