John Lewis pays staff 15 percent bonus as profits rise

LONDON, England - British retailer, the John Lewis Partnership, posted a 9.6 percent rise in underlying year profit, though it cut its staff bonus payout to 15 percent of salary.

Charlie Mayfield, chairman of the employee-owned group, which runs Britain's biggest department store chain as well as upmarket grocer Waitrose, said on Thursday that although there were more encouraging signs for the UK economy as a whole, they had not yet resulted in a significant increase in consumer spending.

"I am cautiously optimistic that we will see improvements this year," he said, adding that John Lewis and Waitrose were well placed to continue to grow market share.

The group made profit before tax, a staff bonus pool of 202.5 million pounds ($338.8 million) and one-off items of 376.4 million pounds in the year to January 25, on gross sales of 10.2 billion pounds, up 6.6 percent.

John Lewis said its 91,000 staff, known as partners, will be paid a bonus of 15 percent of salary, equal to nearly eight weeks pay, down from 17 percent last year.

The 150-year-old group, whose worker co-ownership business model has been lauded by Prime Minister David Cameron, has consistently bucked retail gloom, winning market share over the last five years.

Its generally more affluent customers were less impacted by the economic downturn and it has a bias to the more prosperous south east of England. A big push online, improvements to stores, products, service, promotions and marketing, have also chimed with shoppers.

John Lewis ended the year with net debt of 485.8 million pounds, up 30.6 percent, and a pension deficit of just over 1 billion pounds, up 22.1 percent.