John Lewis raises profit guidance, repays government Covid loan early
John Lewis Partnership said Friday that trading during the peak shopping season, which included Black Friday and the Christmas period, “held up better than anticipated”.
It was good news from the employee-owned company that has gone in a few years from being almost unstoppable to enduring falling sales and profits that have led to some permanent store closures.
As a result, it expects its full-year profits “to be ahead of the profit guidance provided at our half-year results last September, where we said the most likely outcome would be a small loss or a small profit for 2020/21”. We won’t know the exact figures until March 11 when it releases its annual results, but it looks like the company could avoid making a loss for the year.
The company also announced the early repayment of the £300 million HM Treasury and Bank of England Covid Corporate Financing Facility, which was due for repayment on 15 March.
“Despite the headwinds of the last year when John Lewis stores were closed for several months, and future trading volatility, the Partnership believes it has sufficient liquidity going forward,” it said.
A number of big-name retailers have turned down government furlough money or repaid loans early as they’ve benefited from strong online operations. And while John Lewis’s stores have been shut for big chunks of the past year, the company had a well-developed online operation already when the pandemic hit. It was able to exploit this and saw e-sales rising from around 40% of its total to over 60% as a result.
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