Chairman predicts "slow, drawn out economic recovery?

John Lewis boss says trading will stay tough

The chairman of department store group John Lewis has said he expects trading conditions to remain difficult for the rest of the 2009 and into 2010, as the chain reported a drop in gross sales of almost three per cent.

The John Lewis Partnership, which also includes supermarket chain Waitrose, saw gross sales of £3.39 billion in the six months up to 1 August – 3.5 per cent higher than last year. However, only £1.21 billion was from the department store itself – down 2.9 per cent.

Charlie Mayfield, chairman of the John Lewis Partnership, said: “We’re pleased with our first half performance, the result of our early response to the downturn, the slight easing of trading conditions and, crucially, the action we’ve taken to build momentum in every part of the business. We moved from flat sales in the first quarter to a 7 per cent increase in the second, which gives us confidence in the power of the significant initiatives to drive the business forward.”

“We believe that trading conditions this year will continue to be better than expected. However, 2010 may be difficult and we foresee a slow, drawn out economic recovery,” he added.

The group’s online division, John Lewis Direct, saw a rise of 11.6 per cent in gross sales to £151.5m, which the chain said is due to an increase in the number of lines available and new services including ‘Click and Collect’ and express delivery.

Six weeks into the second half, Partnership sales are up 6.2 per cent on last year. Waitrose sales have increased by 11.3 per cent, while John Lewis sales are 1.3 per cent lower.

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