John Lewis Delivers a Good Performance

Date Published:05/01/2012

John Lewis has reported that it has enjoyed an “outstanding” Christmas. In the five weeks to 31st December, sales reached £596m, which is a 9.3% increase on 2010. Like-for-like sales rose 6.2%, surpassing analysts’ expectations after the company experienced a surge of customers just before Christmas. Online sales rose 27.9%, and now stand at £600m.

The company performed well in its fashion departments and homewares sector, but sales of large televisions were poor. John Lewis’ managing director, Andy Street, said, “Sales during the four weeks to Christmas Eve were outstanding. During that period we broke the record for our biggest week ever with a sterling total of £133m”.

The company’s bonus is likely to be lower than last year, as profits would have been affected in order to generate sales. Investments made by the company impacted the final profit for the year, and high levels of discounting in the run-up to Christmas meant that a dent of roughly £9m was made in its profit.

Not everyone regards John Lewis’ results has positive, however. Neil Saunders, managing director of retail consultancy Conlumino, said, “If these are the results for the winners, it paints quite a bleak picture for the rest of the high street, both on the sales front and the margin front. I would expect a lot of other players to do substantially worse…With a few exceptions, it will probably get gloomier from this point on”.