John Lewis puts prized bonus in peril for first time since 1953. The chairman of John Lewis and Waitrose on Thursday said the retailers could scrap their staff bonus for the first time since 1953 as uncertainty looms over the businesses. Sir Charlie Mayfield, the outgoing chairman of the mutual retail group, said the board was considering whether it was “prudent” to make a payout “in light of business and economic prospects”. A decision by the board, of which five are elected directors by staff, will be made in March. “Every year there is a possibility of a zero bonus. We can afford to pay [one] at modest levels, but we are in unusual economic circumstances,” said Mayfield. Finance boss Patrick Lewis said Brexit, as well as a slump in customers’ willingness to part with cash, were some of the factors that might influence the decision.
Prudential renews link with Singapore lender in £662m Asian growth deal. Insurance giant Prudential (PRU) will pay £662 million to renew a tie-up with Singaporean lender United Overseas Bank until 2034. The deal, originally signed in 2010, will give the Pru access to more than four million United customers based in Singapore, Malaysia, Thailand, Indonesia and a new territory in Vietnam. Prudential’s life insurance products will be distributed through United’s 400-strong branch network. The company, in the midst of a divorce from the Prudential UK arm and fund manager M&G Investments, is well known for its big presence in Asia, especially the Chinese market. The Pru will make the payment over three years.
M&S vows to shake off festive letdown. The boss of Marks & Spencer Group (MKS) said “there’s a lot more to do” to return the retailer to its former glory after poor sales over Christmas. Chief executive Steve Rowe, who is trying to overhaul the business under chairman and retail veteran Archie Norman, said: “We have to stick to the knitting and make sure the business has a long-term sustainable base. “I’m conscious of that, but we’ve seen some encouraging steps.” The business, which hit peak profits of £1 billion in the late Nineties, posted a total fall of 2.2% in same-store sales in Britain, with food and clothing and home down 2.1% and 2.4%.
Debenhams rules out borrowing Mike Ashley cash. Debenhams (DEB) on Thursday said it did not want Mike Ashley’s help to bolster its coffers as it tries to revive its fortunes. The ailing department store chain is in talks with its lenders to refinance the business, but new finance chief Rachel Osborne made clear that the Sports Direct tycoon “is not a lender”. Ashley, who owns 29.7% of Debenhams, went to war in December with the retailer after it refused a £40 million loan from him. The billionaire emailed chief executive Sergio Bucher with dire warnings about the chain’s future and offering financial aid. Bucher said: “We did not ask for any help [from Ashley].”
Tesco outmuscles rivals with festive sales success. Tesco (TSCO) showed supermarket rivals a clean pair of heels on Thursday as it reported its best Christmas since 2009 and claimed to be grabbing customers from across the sector. With some rivals recording profit alerts and warning that consumers are spending with caution, a newly confident Tesco said same-store sales rose 2.2% in the UK over six weeks of Christmas. They weren’t as good in the third quarter, at 0.7%, but the UK’s biggest supermarket was still able to brag of 12 consecutive quarters of growth
Halfords takes £10 million profit hit after warm winter weather. Cautious shoppers reluctant to splash out on bikes and mild weather hitting sales of driving staples like de-icer ran shares in retailer Halfords off the road on Thursday. The firm slumped by as much as 25% after admitting that this year’s profits would be at least £10 million lower than last year, coming in between £58 million and £62 million. Next year will be similarly lacklustre, it added. Halfords Group (HFD) was hamstrung by much higher winter temperatures than average — including the second warmest December in 30 years — which drove motoring sales down 3.4% on last year in the 14 weeks to January 4. “Stuff like de-icer you only buy when it freezes, and it didn’t,” chief executive Graham Stapleton said. But drivers were also reining in on discretionary items like roofboxes as well in what was a “challenging quarter” for the business.
Brighton Pier owner chaired by Luke Johnson warns on profit. Serial entrepreneur Luke Johnson faced more woes on Thursday as the leisure group behind Brighton Pier, which he chairs, warned on profits. AIM-listed Brighton Pier Group (The) (PIER), which owns the grade II-listed pier as well a number of bars and golf sites, said full-year pre-tax profits are expected to be around 18% lower than the £3.8 million originally expected. The pier division suffered in the half to December 31 from poor weather and because a number of trains to and from Brighton were disrupted by major engineering works. The company said that the works “significantly impacted” the number of visitors to the seaside resort. The shares fell 15p to 48p.