Mar 5, 2020

John Lewis cuts bonus to lowest level since 1953 as profits slip

Partners at John Lewis will receive their lowest annual bonus since 1953, equivalent to 2 per cent of their salary, as chairman Sharon White embarks on a strategic review that could take up to five years to deliver results. Across the partnership, revenue was £10.3bn but pre-tax profit rose from last year's £117m to £146m. That was however boosted by more than £100m of exceptional income, mostly arising from changes to the pension scheme, and masked a big drop in profits at the department stores. John Lewis's operating profit fell by £75m, before exceptionals and the effect of new lease accounting rules, to £40m. The carrying value of its stores was impaired by £101m. Two years ago, the department stores made more than £250m of operating profit. In October the outgoing chairman Charlie Mayfield unveiled a restructuring designed to take £100m of costs out of the business and unify the management of Waitrose and John Lewis, which had previously been run as separate business units under divisional managing directors. Both those individuals - Rob Collins at Waitrose and Paula Nickolds at John Lewis - have since left the business, along with other senior managers.

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