Falling consumer demand hits John Lewis

The group, which '‹includes the department store chain and '‹upmarket'‹ supermarket Waitrose, s'‹aid'‹ pre-tax profits for the six months to July '‹29 fell 53'‹ per cent to £26.6'‹m following restructuring and redundancy costs.Chairman Sir Charlie Mayfield said the group '‹took a hit in categories linked to the housing market."The first half of this year has seen inflationary pressures driven by exchange rates and political uncertainty," he said."These have dampened customer demand, especially in categories connected to the housing market. The exchange rate-driven increase in cost prices has also put pressure on margin."Retailers have been among the hardest hit by the decline of the UK currency, which has resulted in costs and shop prices soaring, denting consumer demand.However, Sir Charlie '‹said John Lewis has held back on increasing prices across "many areas".Gross sales across the '‹John Lewis '‹Partnership rose 2.3'‹ per cent'‹ to £5.4'‹bn, but like-for-like sales showed '‹small growth. Like-for-like sales at Waitrose rose 0.7'‹ per cent'‹ while at John Lewis comparable sales nudged up just 0.1'‹ per cent'‹.Stripping out exceptional items, '‹pre-tax '‹profit '‹fell 4.6'‹ per cent'‹ to £83'‹m, while operating profit '‹slumped 39'‹ per cent'‹ to £69'‹m.Looking ahead, Sir Charlie s'‹aid: "Sales growth has continued in the first few weeks of the second half. '‹"'‹We are well set for our all-important seasonal peak, but we expect the headwinds that have dampened consumer demand and put pressure on margins to continue into next year."