John Lewis returns to profit but staff denied bonus as 11,000 jobs reportedly at risk
John Lewis has bounced back after last year's losses
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The John Lewis Partnership (JLP) has returned to annual profit but has ruled out paying its workers a bonus for the second consecutive year in a row with 11,000 jobs reportedly at risk.
The department store company made a £56million pre-tax profit in the year to 27 January, which is a reversal from its £234million loss from the last financial year.
However, the owner of John Lewis and Waitrose will not pay its workers a bonus despite returning to profit.
Currently, the retailer employs around 74,000 people but these workers will not be paid a yearly bonus for the third time since 1953.
In January, it was reported that JLP plans to cut 11,000 jobs over the next five years as part of its turnaround plans.
These roles would be cut over the next five years as part of goals to save £900million by the 2027-28 tax year.
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The John Lewis owner returned to profit but the owner is reportedly mulling over potential cuts to staff roles
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On the BBC last week, the John Lewis Partnership's chair Sharon White was asked if job cuts were part of the group’s “quite bold changes”.
White responded: “We are trying to simplify the way we work, so that our amazing partners have got more time in front of customers.”
The department store chain said that “after careful consideration” it would not pay its workers an annual bonus for the second year running.
However, the John Lewis owner confirmed it would raise overall pay for employees by a record £116million this year.
In its latest financial statement, the group stated it has cut costs by £88million in the last financial year.
This has been achieved thanks to changes to staff hours and exploring “simplified ways of working” across stores and central teams.
In 2024-25, John Lewis and Waitrose’s owner is looking to raise in investment by 70 per cent to £542million.
This investment will primarily focus on modernising technology, overhauling its stores and simplifying the group’s operations.
According to the group, it expects to make a “continued improvement” in profit this year as it changes its strategy.
Among its aims include opening new Waitrose shops and refurbish 80 supermarkets, while adding around 80 new brands to the department store chain.
The company stated: “Given the significant changes in the economy since we announced our strategy in 2020, we have refreshed our plan.
“We’re simplifying our business and improving productivity to generate stronger performance, from which we will invest to modernise and energise our unique customer offer.”
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Staff have been denied an annual bonus for the third time since 1953
GETTYThe group’s chair noted that today’s results show the organisation’s “plan is working” to become profitable once again.
She explained: “We have made significant progress in the last year to return the business to profitability and delivered results that allow us to increase investment in our retail businesses; we expect profits to grow further this year.
“This shows our plan is working, while we know there’s much more to do. Our improved performance has been supported by our customers’ love for both brands, with more people choosing to shop with us than ever before, and our partners’ commitment to delivering excellent customer service.
“This year we will unashamedly focus on investing back into our retail businesses for our customers.”