John Lewis Partnership PLC has parted company with managing director Paula Nickolds and said it may not pay staff a bonus this year as the retailer posted a dreadful set of numbers for the key festive period.
The partnership reported a 2.0% decline in like-for-like sales from its John Lewis chain to £1.1bn, with gross sales down 2.3%.
READ: John Lewis never knowingly overstaffed as it cuts a third of senior management
Full-year profits will be "substantially down" on last year, said outgoing chairman Charlie Mayfield, with Waitrose profits expected to be broadly in line with last year and John Lewis reversing the losses incurred in the first half.
While the balance sheet remains strong, Mayfield said: "The Partnership board will meet in February to decide whether it is prudent to pay a Partnership Bonus. The decision will be influenced by our level of profitability, planned investment and maintaining the strength of our balance sheet."
The group said Nickolds, who is MD of the John Lewis & Partners chain, was leaving after 25 years at the partnership as part of its new management plan agreed with new chair Sharon White ahead of her arrival at the start of February, with directors of John Lewis and Waitrose integrated under one new executive team structure.
Looking to save £100mln and help to break out of the "cycle of declining returns", the group said more than 90% of executive appointments have now been confirmed.
John Lewis trading looks poor with LFL -2% and profits expected to be well down. What does this business stand for? It's not good value and its customer service is nothing special. Yet it has lots of costs that it is finding harder to cover. The next Debenhams?
— Phil Oakley (@philjoakley) January 9, 2020
Waitrose supermarkets grew LFL sales 0.4% to £1.03bn, though gross sales were down 1.3% as some shops were closed.
Within John Lewis, homeware sales were down 3.4% and electricals & home technology fell 4%, with a rise in demand for Black Friday followed by “subdued demand in the subsequent weeks”.
Brighter spots were seen in beauty sales, up 4.7% and well ahead of the market, while fashion sales were just about flat