John Lewis Partnership has reported a 26% fall in half-year profits, warning that higher pensions costs will affect its full-year figures.
The staff-owned parent company of John Lewis and Waitrose posted profits of £96 million in the first six months of its financial year. In the full year, its pensions cost was likely to be £270m - £320m, down from £342.7m last year.
In addition to the cost of pensions, Waitrose saw a fall in like-for-like sales for the first time in seven years. Compared with the same period last year, like-for-like sales were down 1.3%. But this was offset by a 3% growth in John Lewis sales.
Chairman Sir Charlie Mayfield said: "At a trading level our profits were broadly level with last year, despite the turmoil in the grocery market.
"That reflects tight management of costs and the steps we have taken to strengthen the appeal of our trading brands, where we have seen an encouraging increase in the number of customers shopping with us."