As Morrisons reported an impressive hike in its profits, and thanks cash-strapped shoppers, premium end supermarket chain Waitrose today unveiled an eight per cent fall in operating profit in the six months to July 26.
Part of the British department stores and supermarkets group John Lewis, Waitrose operating profit fell to £103 million in the period, its first profits fall since 2002. But it fared far better than John Lewis overall, which posted a 27 per cent decrease in first-half profit.
The employee-owned group said it remains cautious about the outlook, not just for the rest of this year, but also for 2009.
John Lewis Partnership chairman Charlie Mayfield said in his statement: “After the initial shock of the credit crunch last summer, the economic climate has become progressively more difficult, consumer confidence has hit a record low and the retail market has slowed markedly.
Our first half performance reflects the challenging trading environment, our response to those conditions, a particularly strong performance in the first half of 2007 and our continued investment in growing and developing our business,” he said.
“We have responded to the difficult trading conditions by investing in the long-term development and growth of the business,
“Waitrose has invested in strengthening its customer offer - further improving the quality of our products, introducing new, innovative ranges and investing in price and customer service. We have reformulated many of our products to enhance their quality and achieved the highest ever rating in taste tests.”
He added: “£30m was invested in lower prices and increased promotional activity to build our value proposition and we are investing almost £2m to improve customer service. We have continued to support British farmers and ensured that customers are protected from the full effect of price inflation by absorbing some of the price increases.”
