John Lewis hails record Black Friday but warns over margin pressure

John Lewis said on Thursday that Black Friday 2017 was its most successful sales day in history, but the retailer also sounded a cautious note about the outlook and said trading was likely be “volatile”.

In the six weeks to the end of December, gross sales at the John Lewis Partnership were up 2.5% to £1.96bn, with John Lewis sales up 3.6% and sales at Waitrose 1.4% higher. On a like-for-like basis, John Lewis sales rose 3.1%, outperforming the market by 4.5%, while Waitrose sales increased 1.5%.

Black Friday was John Lewis's most successful sales day in its history and contributed to the biggest ever week of sales, up 7.2% year-on-year. The company said the Black Friday week also included a record hour for online trade.

Although the Christmas trading update was upbeat, chairman Charlie Mayfield struck a rather cautious note in his statement.

“The pressure on margin seen in the first half of the year has intensified because of our choice to maintain competitive prices, despite higher costs mainly due to the weaker exchange rate. This will negatively affect full-year financial results as indicated previously.

“Looking ahead to 2018/19 we expect trading to be volatile due to the economic environment and anticipate that competitive intensity will continue, driven by the structural changes taking place in the retail industry. We are well placed to continue building the strength of our two leading brands through these changes and will maintain our current investment plans. Our focus continues to be offering our customers the best range of products and the best value, supported by a market leading service.”