Slip threatens John Lewis bonus
THE 58,000 employees of John Lewis Partnership could suffer a cut in their bonus for the fifth year running after the retail group reported a slide in half-year profits.
The department stores and Waitrose supermarkets group, Britain's biggest employee-owned business, reported a £10m drop in profits before tax to £34m.
The fall was due to the need to beef up the pension fund, which has a serious shortfall. Its bill for the scheme jumped 14% to £33m. The firm also suffered a £9m loss at its internet-based home-delivery service Ocado.
The annual staff bonus - which can amount to a fifth of salary in a good year - is paid out of full-year profits and is due to be announced in March. Last year it was 9% of pay.
Chairman Sir Stuart Hampson said the group had time to reverse the profits fall in the second half with Christmas trading. He said the group traded well in the half-year with underlying sales in the department stores up by 4% and Waitrose by 3.5%.
John Lewis added that both divisions had made a 'promising start' to the second half, with sales at both ahead 5%. But, it added, 'The group continues to keep its cost base under review, especially in light of the prevailing uncertainty in the economic outlook and consumer spending.'
