The John Lewis Partnership has announced a return to profit after several years of losses.

The department store attributed the improved performance to a rise in sales, an improvement in gross margins and an increase in productivity.

In the year to 27 January, John Lewis recorded pre-tax profit of £56 million compared to a loss of £234 million in the previous year.

Sales over the 12-month period jumped one per cent to £12.4 billion, while total revenue grew two per cent to £10.8 billion.

Despite its return to profitability, the retailer said that it will not be paying out partner bonuses this year.

Instead, the company is investing in improving the business and pay for its employees.

In September 2023, John Lewis managed to narrow its losses by 14 per cent in the first half of the year.

However, rising costs driven by inflation knocked back the company's ambitious transformation plan.

“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,” said Sharon White, chairman of the John Lewis Partnership. “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.”

White went on to say that over the next 12 months the company will “unashamedly” focus on investing back into its retail businesses, including opening new Waitrose shops and continuing to modernise its John Lewis brand offering in John Lewis.

In its latest financial results, sales at Waitrose jumped by five per cent to £7.7 billion. John Lewis said that this was thanks to a campaign around lower prices.

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