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John Lewis slashes bonuses after slump

‘Challenging year’: John Lewis boss Sir Charlie Mayfield

STAFF at John Lewis Partnership will see their bonuses cut for the fifth year in a row after profits slumped.

The retailer said the bonus would be five per cent of annual salary — down from six per cent last year and 17 per cent in 2013 — with 85,000 staff sharing a £74million pot.

John Lewis chairman Sir Charlie Mayfield said it had been a ‘challenging year’ for the partnership — which includes the Waitrose chain — as it posted a 77 per cent plunge in bottom line pre-tax annual profits to £103.9million after one-off charges. Underlying pre-tax profits fell 21.9 per cent to £289.2million in the year to January 27.

Sir Charlie warned the group expects ‘further pressure on profits’ amid volatile trading and said the group warned in January last year that ‘weakness in sterling’ would add to costs.

He said: ‘This was why we chose to reduce the proportion of profits paid as partnership bonus last year so as to absorb these impacts while continuing to invest in the future and in strengthening our balance sheet.’

Operating profits at John Lewis rose 4.5 per cent to £254.2million, but those at Waitrose dropped 32.1 per cent to £172million, which was partly down to a decision ‘not to pass on all cost price inflation’.